DJIA Today Moving on GE, MS, MCD, and YUM News

DJIA today, July 21, 2014: The Dow Jones Industrial Average bounced back on Friday, up more than 100 points following Thursday's 161-point drop. Geopolitical tensions remain high following the attack on a Malaysian jet airliner over Ukrainian skies Thursday morning and Israel's tactical launch inside Gaza.

The rebound on Friday suggests that investors are paying more attention to second-quarter earnings than events in Ukraine and Gaza.

Here's the news moving the DJIA today:

  • DJIA TodaySpin-Off Plans: Investors are ramping up interest in General Electric Co.'s (NYSE: GE) pending initial public offering spin-off for its private-label credit card division. However, it's unclear whether investors will invest in a sector so closely linked to the tepid recovery in consumer spending. The IPO will sell roughly 15% of shares in GE's Synchrony and could raise up to $3.1 billion. Such a level would outpace the IPO of Ally Financial Inc. (NYSE: ALLY) as the largest IPO in the financial sector for 2014.
  • Commodities Return: Reuters reports that Morgan Stanley (NYSE: MS) will restock its commodity trading units this summer. This comes less than two years after the company reduced its exposure and pulled away from commodity categories. According to reports, the investment bank will hire nearly a dozen traders and sales professionals to rebuild its commodity business.
  • IPO of the Year: Chinese e-commerce giant Alibaba Group Holding Ltd. (NYSE: BABA) announced it would engage its initial public offering after the September 1st Labor Day holiday. MarketWatch reports that an insider said the company didn't want to rush its launch in August, a period when IPO activity and market news slows. The IPO is expected to reach $20 billion, making it the largest tech IPO deal ever.
  • Health Concerns: Two American fast food chains are facing public relations crises after both allegedly sold products that used expired meat from a processor at locations in China. The Shanghai Food and Drug Administration (SFDA) froze operations of Shanghai Husi Food Co., a processor that is suspected of selling expired meat to McDonald's Corp. (NYSE: MCD) locations and Yum! Brands Inc. (NYSE: YUM) KFC and Pizza Hut stores.

  • A Big Settlement: A Florida jury awarded the widow of a lifelong smoker a stunning $23.6 billion settlement for damages linked to the husband's death from lung cancer. An executive at R.J. Reynolds Tobacco Co. (NYSE: RAI) called the ruling "grossly excessive" and vowed to fight the verdict. The announcement comes days after Reynolds announced plans to purchase Lorillard Tobacco Co. (NYSE: LO), the nation's third-largest cigarette maker, for $25 billion.
  • Earnings Estimates: This will be a big week for technology companies and their earnings reports. Earnings from online powerhouses Netflix Inc. (Nasdaq: NFLX), Microsoft Corp. (Nasdaq: MSFT), Facebook Inc. (Nasdaq: FB) and Inc. (Nasdaq: AMZN) will headline an extremely busy earnings week.
  • Impact of Flight MH17: Following two aviation disasters in less than five months, Khazanah Nasional Bhd., Malaysia's state investment fund and owner of 69% of shares in Malaysia Airlines, said it will likely take the airline company private.
  • Earnings Reports: Stay tuned for earnings reports from AbbVie Inc. (Nasdaq: ABBV), Allergan Inc. (NYSE: AGN), BB&T Corp. (NYSE: BBT), Chipotle Mexican Grill Inc. (NYSE: CMG), Halliburton Co. (NYSE: HAL), Navios Maritime Partners LP (NYSE: NMM), Netflix Inc. (Nasdaq: NFLX), and Texas Instruments Inc. (NYSE: TXN).
  • Today's Economic Calendar: Today's light schedule features the Chicago Fed National Activity Index.

Full U.S. Economic Calendar July 21, 2014

  • Chicago Fed National Activity Index at 8:30 a.m.
  • 4-Week Bill Announcement at 11 a.m.
  • 3-Month Bill Auction at 11:30 a.m.
  • 6-Month Bill Auction at 11:30 a.m.

More than 10,000 Baby Boomers are retiring in the U.S. every day. And that's creating a huge opportunity for bioscience investors. Here's why...

About the Author

Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.

Read full bio