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The Dow Jones and the S&P 500 both reversed course after five consecutive losing sessions. The Dow added 190 points as optimism on rising consumer confidence offset worries about the meltdown happening in the Forex markets over Switzerland's surprise currency announcement yesterday.
The CBOE Volatility Index (VIX), the market's fear gauge, slipped 6.4% on the day.
Dow: 17,511.57, +190.86, +1.10%
S&P 500: 2,019.42, +26.75, +1.34%
Nasdaq: 4,634.38, +63.56, +1.39%
What Moved the Markets Today: U.S. consumer sentiment struck its highest levels in 11 years in January, renewing confidence in the U.S. economy. Meanwhile, factory output also increased last month. The Labor Department announced today that the consumer price index slipped 0.4% last month. This is its largest one-month drop since December 2008.
Investors also kept a close eye today on an earnings report from Goldman Sachs Group Inc. (NYSE: GS), which reported a 7.1% drop in fourth-quarter net income. GS stock slipped nearly 1% on news the company's revenue from trading and investment banking decreased.
Now check out the day's most important market notes:
- Save the Brokers: The aftermath of the Swiss currency announcement has been swift and merciless. Shares of retail foreign exchange broker FXCM Inc. (NYSE: FXCM) crashed more than 85% in premarket hours, and trading was halted after the company fell into a breach of regulatory capital requirements. Following the Swiss franc's surge yesterday, a number of forex brokers went under, renewing significant concerns about the role of centralized banking in the economy. Shares of Leucadia National Corp. (NYSE: LUK) were also halted this afternoon.
- Energy Rallies: Shares of multinational energy giants Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) rose about 2.4% each this afternoon as crude oil prices rallied in the afternoon. The two companies were in focus during much of the trading session after legendary short seller Jim Chanos announced that he foresees troubles ahead for the world's top energy firms in the wake of crashing energy prices.
- Intel in Focus: Shares of Intel Corp. (Nasdaq: INTC) were up marginally this morning after the company reported it beat per-share earnings estimates. The firm reported fourth-quarter net income of $3.7 billion, or $0.74 per share. That was higher than consensus per-share earnings estimates of $0.71. That didn't stop Jim Chanos from announcing he's shorting INTC stock on concerns surrounding the personal computer industry. Chanos also made his case against electric vehicle manufacturer Tesla Motors Co. (Nasdaq: TSLA) during an appearance on CNBC.
- Energy Impact: It was a good day for oil-field service companies operating outside of the North American market. Oil prices are expected to significantly affect projects in North American energy production more than those operating outside of the continent. That sent shares of Schlumberger Ltd. (NYSE: SLB) up 6.13%. Shares of Halliburton Inc. (NYSE: HAL) gained 4.82%.
Now our experts share some of the most important investment moves to make based on today's market trading - for Money Morning Members only:
- How the Terrorism "Trend" Is Moving Your Money Today: The recent terrorist attack in Paris has spurred the need for a difficult conversation. Here's the thing: The tragic irony in the financial world is that terrorism actually creates far more opportunity than it destroys. Money Morning Chief Financial Strategist Keith Fitz-Gerald explains what this means for your money in 2015 and beyond...
- CES 2015: How to Profit from the Hottest Tech Trends: According to the Consumer Electronics Association trade group, Americans will buy 1.43 million UHDTV sets, or roughly 5% of televisions sold nationally, in 2016. That's a 60-fold increase from 2013, when UHDTVs debuted. And of course, there's big profit potential in all those UHDTVs our fellow Americans will be buying. So hit the floor of the Consumer Electronics Show 2015 with Money Morning Tech Specialist Michael A. Robinson to start profiting today...
- Why the 'Big Money' Still Believes in Auto Stocks:S. auto sales were up big in 2014 and are expected to stay strong in 2015.Oil prices have collapsed and are expected to stay low, fueling demand for pickup trucks, SUVs, and RVs... Indeed, signs of a boom time for the American auto industry appear aligned, but auto stocks are trading at depressed values compared to the rest of the market. Are auto stocks ripe to buy, or are they simply a value trap? Here's the real answer.
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.