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Wall Street news today, July 15, 2014: U.S. markets rallied on Monday as concerns over European debt subsided and investors took a more optimistic stance on second-quarter profit season. The financial sector led the charge ahead of their earnings this week. Today's futures were mixed as the markets prepare for Federal Reserve Chair Janet Yellen's semiannual testimony before Congress.
Here's what you should know to make your Tuesday profitable:
- Dimon Days: Shares of JPMorgan Chase & Co. (NYSE: JPM) were up more than 2.5% in premarket hours after the company beat analyst expectations for the second quarter. The company reported net earnings of $25.3 billion, or $1.46 a share, well ahead of Street expectations of $1.29 per share and revenue of $23.8 billion. Despite the positive news, the company still reported an 8% decline in second-quarter revenue, citing weakness in the mortgage markets and reduced trading revenues.
- Then There Were Two: In a move that will reduce America's 400-year-old tobacco industry to a duopoly of two large competitors, Reynolds American Inc. (NYSE: RTI) announced it will purchase Lorillard Inc. (NYSE: LO) for $27.4 billion including debt. Shares of both companies were down more than 4% in premarket hours. Reynolds' acquisition provides size and scale to compete against tobacco giant Altria Group (NYSE: MO), which maintains more than half of the nation's market share.
- For-Profit Problems: Shares of Apollo Education Group Inc. (Nasdaq: APOL) slipped more than 3.5% in afterhours trading on a report that the U.S. Education Dept. will review federal financial aid programs at the firm's University of Phoenix. The for-profit education industry has come under intense scrutiny in recent years after enrollments surged after the financial crisis. Apollo rival Corinthian Colleges Inc. (Nasdaq: COCO) recently closed or sold more than 100 of its campuses after the government investigated charges of grade fixing, incomplete job placement data, and other problems within the marketing of their education programs.
- Merger Mania: The consolidation continues. This morning, specialty chemicals manufacturer Albemarle Corp. (NYSE: ALB) announced plans to purchase its rival Rockwood Holdings Inc. (NYSE: ROC) for $6.2 billion. Shares of Rockwood surged more than 10% on news of the deal.
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.