DJIA today, July 28, 2014: The Dow Jones posted a 123-point loss on Friday, while other U.S. markets also finished in the red on poor earnings outlooks and news that the economy may not have recovered as much as expected in the second quarter.
Shipments of capital goods slipped by 1% in June, marking the third consecutive month of declining volumes. Meanwhile, gold prices bounced back from a five-week low, recovering to finish above $1,300 an ounce. All eyes will be on the initial release of second-quarter GDP on Wednesday.
Here's what you should know to make your Monday profitable:
Discount Merger: Discount retailer Dollar Tree Inc. (Nasdaq: DLTR) announced it will purchase its larger rival Family Dollar Stores Inc. (NYSE: FDO) for $74.50 a share in cash and stock worth $8.5 billion. Shares of Family Dollar Stores soared more than 24% in premarket hours, while Dollar Tree shares jumped more than 10%. Activist investor Carl Icahn will likely have made nearly $149 million in two months on his investment in Family Dollar Stores.
Airline Launch: Virgin America, the airline partially owned by British entrepreneur Sir Richard Branson, announced it will launch a U.S.-based initial public offering later this year. The company, which announced its first profit since its 2007 launch, will aim to raise $115 million.
Big Changes: The Commodity Futures Trading Commission has charged Lloyds Banking Group (NYSE: LYG) for rigging the London Interbank Offered Rate (LIBOR) and announced that the bank is working out a settlement. Details are emerging this morning and Money Morning will be covering the story in more detail this afternoon.
Crazy Chicken: Shares of El Pollo LoCo Holdings Inc. (Nasdaq: LOCO) continued to surge in premarket hours. The restaurant chain, which began public trading on Friday, was up nearly 5% this morning and continues to be one of the most active stocks this morning.
Real Estate Surge: Shares of Trulia Inc.(NYSE: TRLA) soared more than 16% in premarket hours on news that its rival Zillow Inc. (Nasdaq: Z) had purchased the company for nearly $3.5 billion. Combined, the two online real estate firms have more than 61% of the total web and mobile traffic for the industry. Shares of Zillow were down roughly 2% in premarket hours.
Earnings Reports: Stay tuned for earnings reports from Cummins Inc.(NYSE: CMI), Roper Industries Inc. (NYSE: ROP), Tyson Foods Inc.(NYSE: TSN), Tenneco Inc. (NYSE: TEN), Alliance Resource Partners L.P.(Nasdaq: ARLP), Compass Minerals International Inc.(NYSE: CMP), Armstrong World Industries Inc.(NYSE: AWI), Mercury General Corp.(NYSE: MCY), Sohu.com Inc.(Nasdaq: SOHU).
Today's Economic Calendar: Today's light schedule features the Dallas Manufacturing Index and an update on pending U.S. home sales.
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.