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The Dow Jones suffered another triple-digit plunge Tuesday, extending Monday's massive slump as oil prices continue to fall and concern of global oversupply stings traders. The downturn was fueled by comments from Saudi Arabia's King Abdullah, who said this morning the kingdom will not slash production and will keep output high to protect market share.
The S&P 500 Index fell for the fifth consecutive trading session.
Dow: 17,371.64, -130.01, -0.74%
S&P 500: 2,002.61, -17.97, -0.89%
Nasdaq: 4,592.74, -59.84, -1.29%
What Moved the Markets Today: The energy sector slumped another 1.4% on the day as crude prices fell further. February West Texas Intermediate futures slipped to their lowest levels since April 2009, finishing the day at $48.12 per barrel. Meanwhile, Brent crude, the global benchmark priced in London, slid nearly 3.7% on the day to finish at $51.15 per barrel.
The downturn hit domestic U.S. producers the hardest, although large multinationals were not spared. Shares of Exxon Mobil Corp. (NYSE: XOM), Royal Dutch Shell Plc. (NYSE ADR: RDS.A), and BP Plc. (NYSE ADR: BP) all retreated on the day.
[Editor's Note: This investing tactic can help you beat the market by almost 22% in 2015…]
Here's a breakdown of today's other top stories and stock performances:
- Political Football: The White House announced today it will veto any bill passed by Congress that approves the completion of the TransCanada Corp. (NYSE: TRP) Keystone XL Pipeline. The pipeline, which would transport more than 800,000 barrels of crude oil from western Alberta to the U.S. refinery network, has been held up by the Obama administration for more than six years. The Obama administration has argued the State Department must approve any pipeline that crosses the U.S. border, even though the White House has granted construction permits for pipelines crossing the Mexican border on several occasions. TRP shares fell more than 3.4%, mainly on falling energy prices.
- Deal Discussion: Shares of Twitter Inc. (NYSE: TWTR) jumped more than 6.7% this afternoon after a SunTrust analyst suggested the micro-blogging company could purchase Yahoo! Inc. (Nasdaq: YHOO). Yahoo's former CEO Ross Levinsohn also said this morning that Twitter should purchase the company in the event the online media and search giant decides to divest its business in Asia. Shares of Yahoo were up 0.16% on the day.
- Merger Mania: Shares of AOL Inc.(NYSE: AOL) were up more than 3% news that Verizon Communications Inc. (NYSE: VZ) has approached the firm about a possible merger or joint venture. However, no formal offer has been extended, and Verizon's CEO Lowell McAdam said his company has no plans for any potential deals in the near term.
- Bend-Gate Rebuttal: Shares of Apple Inc. (Nasdaq: AAPL) were up nearly 1% in afternoon trading as Apple stock rebounded from five straight losing sessions. Reports this afternoon indicated Apple could be pushing forward with plans for a "flexible" cellphone. The news comes in the wake of "Bend-Gate," when concerns about the stability of its iPhone 6 led to multiple reports of bending devices. Patent No. 8.929,085 indicates Apple could be pursuing flexible components such as batteries, circuit boards, and screens. Get the latest Apple stock news and analysis here.
- Fed Friends: With two vacancies on the Board of the Federal Reserve, President Barack Obama plans to nominate Allan Landon, former CEO of the Bank of Hawaii Corp. (NYSE: BOH), as one of the central bank's next governors. Landon ran BOH from 2004 to 2010 before founding a Portland community bank investment fund called BanCapital. It is expected that he would receive confirmation from the Republican-controlled Senate after months of industry lobbying for a nomination.
Now our experts share some of the most important investment moves to make based on today's market trading – for Money Morning Members only:
- The Perfect "Anti-Trend" Play: Between its crushing debt, aging population, lack of a workable immigration policy, and decades of abysmal fiscal policy, Japan is in trouble – thus Money Morning Chief Investment Strategist Keith Fitz-Gerald's recommendation to short the currency via ProShares UltraShort Yen(NYSE Arca: YCS). It's returned more than 116% since the Japanese yen was at 76 to the dollar. But it's far from the only way to play Japan at the moment…
- How to Invest Like a CEO – and Beat the Market by 40%: After digging into a recent survey on CEOs, Money Morning Tech Specialist Michael Robinson figured out exactly where today's leaders will be spending their dollars in the next five years. And he wants to show you how to invest like a CEO to take advantage of those long-term spending trends in a way that beats the market by 40%…
- One Stock That Will Profit from a New, Breakthrough Medical Direction: Modern medicine, for all of its sophisticated drugs, complex gadgets, and amazing surgical procedures, rarely cures anything. It treats. It manages. It postpones the inevitable. But return a patient to normal, optimal health? Rarely… So when an innovation comes along that can effect a complete and permanent remission of disease or restore damaged organs to a pristine state, it should cause your keenest investing instincts to perk up and pay attention…
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.