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Good morning! Stock futures for Tuesday, March 17, forecasted a 52-point decrease from yesterday's close. The DJIA Index surged 228 points Monday, a day ahead of the Federal Open Market Committee's (FOMC) second meeting of the year. Notable pre-market movers are American Airlines Group Inc. (Nasdaq: AAL), Karyopharm Therapeutics Inc. (Nasdaq: KPTI), Foresight Energy LP (NYSE: FELP), Edwards Lifesciences Corp. (NYSE: EW), and Targa Energy LP (NYSE: ATLS).
The FOMC meeting today will focus on when the Federal Reserve will raise interest rates. [Investors: Note that our Chief Financial Strategist Keith Fitz-Gerald has outlined a strategy on how to profit regardless of when the Fed raises rates. You can find that here.]
Investors with an eye abroad will dig into the Bank of Japan's monthly policy statement and press conference by the central bank governor to discuss the impact of the nation's stimulus campaign on deflation. Meanwhile, inflation data in Europe will be released, while Germany will react to ZEW economic sentiment levels.
Here's why AAL is one of today's pre-market movers, what else is happening in stock market news, and your "Money Morning Tip of the Day":
- Index Boom: Shares of domestic airline giant American Airlines (Nasdaq: AAL) jumped more than 5% this morning on news the company will be joining the S&P 500. American Airlines will take the place of Botox-manufacturer Allergan Inc. (NYSE: AGN), which is in the process of being acquired by pharmaceutical giant Actavis plc (NYSE: ACT) on the index. The addition will take place after the close of trading on March 20.
- Tweeting Tales: Shares of Tesla Motors Inc. (Nasdaq: TSLA) jumped 3.72% Monday after CEO Elon Musk tweeted the company is about "to end range anxiety" about electric vehicles in a big reveal set for Thursday. Our expert told FOX Business viewers yesterday exactly what he believes Musk's tweet teaser is leading up to – and where TSLA stock is headed in coming months…
- Stepping Down: According to The Wall Street Journal, Uber Technologies' CFO Brent Callinicos is stepping down. According to a company email cited by the newspaper, he will remain a company adviser. Callinicos joined Uber in 2013. Prior to that, he served as Google Inc.'s (Nasdaq: GOOG, GOOGL) treasurer and chief accountant. Uber is the second-largest venture-backed private company and is valued at more than $41 billion.
- Oil Prices Today: U.S. oil prices fell to a fresh six-year low this morning. Both WTI crude and Brent crude continued to slide on oversupply concerns and news of progress between the United States and Iran on their nuclear program talks. Any deal would end economic sanctions and allow more oil to flow to the international markets. Brent crude, priced in London, slipped 2.1% to $52.80 per barrel. WTI crude, marked in New York City, fell 2.6% to settle at $42.67 per barrel.
- Earnings Reports: Investors can expect earnings reports today from Adobe Systems Inc. (Nasdaq: ADBE), DSW Inc. (NYSE: DSW), InterOil Corp. (NYSE: IOC), and Oracle Corp. (Nasdaq: ORCL). Shares of Oracle are especially in focus today after news broke last week that CEO Larry Ellison received more than $100 million in compensation in 2014.
Full U.S. Economic Calendar March 17, 2015 (NYSE: all times EST)
- Housing Starts at 8:30 a.m.
- Redbook at 8:55 a.m.
- 4-Week Bill Auction at 11:30 a.m.
Money Morning Tip of the Day: Market volatility will continue in coming months, but you can survive and even profit from wild market swings with these tools…
Today's tip comes from Money Morning Tech Expert Michael A. Robinson:
Markets are extremely volatile right now. Last week the Dow Jones saw triple-digit gains or losses on four of five trading days.
This volatility will continue as investors grapple with economic data and try to gauge when the U.S. Federal Reserve will raise interest rates.
You can survive and even profit from market volatility using these five tools…
Market Volatility Tool No. 1: Make Lowball Offers: With stocks, it's easy to make lowball orders. These are called "limit" orders, meaning you only buy when the stock hits your chosen personal target price. Suppose a stock you want to buy and hold for the long haul had a recent high of $100 and then dropped to $75. A lowball limit order of, say, $60 (a 20% discount) will protect your risk of losses and greatly boost your long-term gains.
Market Volatility Tool No. 2: Buy "Test Shares": Buying a few test shares is a great way to establish a position. As the term implies, you would buy only about 5% to 10% of your usual position on a stock, using it as your initial entry point. That way if it tanks, you won't get killed. You've only devoted a small amount of your risk capital to this investment.
Market Volatility Tool No. 3: Limit Your Exposure: A good way to stay in the market and limit your risk of loss is simply to make smaller entries. You can even combine the test-share and exposure-limit strategies. Start by purchasing your test-share block, re-evaluate both the stock and the market, and then purchase the remaining shares required to establish the smaller than usual "exposure limit" position.
To get the last two tools and learn more about turning choppy markets to your advantage, go here: How to Profit from Market Volatility…
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.