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Dow Jones futures for Wednesday, Feb. 11, forecasted a 29-point drop from yesterday's close. Yesterday, the Dow Jones Industrial Average added 139 points on growing investor optimism about a pending deal to address Greece's debt crisis. Also fueling upward momentum for the DJIA were better than expected earnings from companies such as The Coca-Cola Co. (NYSE: KO).
Today, investors will continue to keep an eye on talks between the European Union and Greece over the beleaguered nation's debt situation. At 11:30 EST, Greek Finance Minister Yanis Varoufakis will meet with Eurozone financial ministers to discuss new reform proposals and an overhauled bailout plan to address his nation's economic condition.
This morning is also a very busy earnings day. Companies reporting today include AOL Inc. (NYSE: AOL), Baidu Inc. (Nasdaq: BIDU), Cheesecake Factory Inc. (Nasdaq: CAKE), Equifax Inc. (NYSE: EFX), Lorillard Inc. (NYSE: LO), Mosaic Co. (NYSE: MOS), Panera Bread Co. (Nasdaq: PNRA), PepsiCo Inc. (NYSE: PEP), Time Warner Inc. (NYSE: TWX), Whole Foods Market Inc. (NYSE: WFM), and Zoetis Inc. (NYSE: ZTS).
Here's what else you should know about the stock market today - including your "Money Morning Tip of the Day" - to make it a profitable Wednesday:
- Going Private: Shares of Chico's FAS Inc. (NYSE: CHS) were about 8% in pre-market hours on news that private equity firm Sycamore Partners is looking for funding to take the company private. The women's retailer, which has a $2.5 billion market capitalization, could fetch a premium north of $3 billion.
- Electric Feel: Shares of Tesla Motors Inc. (Nasdaq: TSLA) slipped 1.4% pre-market on news that the company's sales in China could be weaker than expected when it reports fourth-quarter earnings. The news has placed its CEO Elon Musk in a difficult position. Reports indicate that Musk is very disappointed with sales in China and that he is threatening to fire a number of key executives in the country over its expected sales report.
- Merger Mania: Shares of Rite Aid Corp. (NYSE: RAD) were up 8.6% this morning on news that the drug store chain plans to purchase pharmacy benefits manager Envision Pharmaceutical for roughly $2 billion from private investment firm TPG. The deal will allow Rite Aid to better compete against its rivals like Walgreens Boots Alliance Inc. (NYSE: WAG) in the rapidly changing pharmaceutical industry.
- Bankruptcy Blues: If you find any gift cards to RadioShack Inc. (NYSE: RSH) rattling around in your junk drawers, now is the time to redeem them. The failing retailer announced that it will only accept remaining gift cards until March, as the firm is currently undergoing a bankruptcy restructuring.
- Oil Prices Today: Oil prices continue to slide on oversupply expectations. This morning, the American Petroleum Institute, a large D.C. energy lobbying firm, said that U.S. oil inventories increased by 1.6 million barrels last week. March 2015 futures for U.S. crude slipped 0.6% at the NYMEX in New York City to hit $49.75 per barrel. Meanwhile, Brent crude, priced in London, fell 1.1% to $56.87 per barrel.
Full U.S. Economic Calendar February 11, 2015
- MBA Purchase Applications at 7 a.m.
- Richard Fisher Speaks at 8 a.m.
- EIA Petroleum Status Report at 10:30 a.m.
- 10-Year Note Auction at 1 p.m.
- Treasury Budget at 2 p.m.
Legal insider buying is a well-known "Buy" signal for a stock. That's because nobody is closer to a company's most up-to-date financial results and forecasts than its own officers and board members.
But there's a proxy for insider buying that can be just as useful.
Money Morning Executive Editor Bill Patalon dubs the second group "knowledgeable outsiders." These include certain hedge funds and private equity players. Also in this group are investing icons like Warren Buffett, Carl Icahn, and George Soros.
So why should investors pay attention to what the "smart money" is doing?
Says Patalon, "Smart-money players like Buffett, Soros, and Icahn are a separate set from the rest of the Wall Street rabble. They're independent thinkers and often make moves so 'contrary' to the prevailing thinking that the masses label them as crazy."
These "crazy" moves can be tough to make. That's why the masses are busy running in the opposite direction.
But they can also put you on the path to some outsized profits of your own.
Patalon just shared a brand-new move by a smart-money private-equity player that makes a bold statement about a Contrarian profit opportunity. Get his pick right here...
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.