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Good Morning! Stock futures today (Tuesday) forecasted a 42-point gain for the DJIA from yesterday's close. On Monday, all major benchmarks erased earlier gains in the last 15 minutes of trading to close in the red. The Dow Jones fell 11 points on news that investors weighed fluctuations in the U.S. dollar and its effect on global commodity prices.
What to Watch Today: Investors will react to a busy economic calendar. This morning, St. Louis Federal Reserve President James Bullard called for a raise in interest rates during a speech in London. Consumer price and new homes data are on tap this morning, which will affect both consumer discretionary and housing stocks during today's session.
Investors with an international focus are trying to digest the HSBC manufacturing purchasing managers' index levels for China. The nation's factory activity hit an 11-month low in March, as its economy continues to struggle. The index slipped in March, while both employment and new orders fell.
In addition, March Markit PMI data will be released for the largest European economies. The news comes as the European Central Bank is in its first month of a 1 trillion euro stimulus program to boost the struggling economic bloc.
Here's what else you should know about the stock futures today - including your "Money Morning Tip of the Day" - to make it a profitable Tuesday:
- Social Status: Shares of Facebook Inc. (Nasdaq: FB) were up 0.5% on news the company plans to host news content directly on their site. The social network will initially host content from The New York Times, BuzzFeed, and National Geographic on the site rather than requiring external links from Facebook feeds. The news providers will split advertising revenue with Facebook on the new platform.
- Biotech Bust: Yesterday, the iShares Nasdaq Biotechnology ETF (NYSE: IBB) dipped 2.25%, as investors worried the biotech sector may be overheating. Don't buy into that hype. As we explained this week, the 2015 surge in the biotech industry signals a healthy sector with many investment opportunities. Go here to reveal our favorite biotech stocks for the year ahead.
- Debt Bubble: Shares of Whiting Petroleum Corp. (NYSE: WLL) slumped more than 13% this morning on news the company is taking drastic measures to resolve its $6 billion debt burden. The oil producers will offer 35 million shares and roughly $1.75 billion in notes and convertible notes. The deal is part of a broader problem plaguing the energy markets, as oil companies are scrambling to resolve their debt issues in the wake of cratering oil prices. Our Dr. Kent Moors explained this threat earlier this month, and how you can profit.
- Mining Slump: Shares of Freeport-McMoran Inc. (NYSE: FCX) slid more than 3.2% in pre-market hours on news the company will slash its quarterly dividend by 84%. The world's largest copper miner announced changes to its payouts due to a weakening market for commodities. Shares of FCX are down more than 17% since the beginning of the year.
- Oil Prices Today: A declining dollar has overshadowed weak Chinese data and news that Saudi Arabia's oil production has hit an all-time high. Brent crude was flat this morning just beneath $56 per barrel. WTI crude was up 0.2%.
- Earnings Reports: Investors can expect earnings reports today from Christopher & Banks Corp. (NYSE: CBK), McCormick & Co. Inc. (NYSE: MKC), IHS Inc. (NYSE: IHS), HB Fuller Co. (NYSE: FUL), HD Supply Holdings Inc. (NYSE: HDS), Sonic Corp. (Nasdaq: SONC), and Steelcase Inc. (NYSE: SCS).
Full U.S. Economic Calendar March 24, 2015
- Louis Federal Reserve Bank President James Bullard speaks at 6:05 a.m.
- Consumer Price Index at 8:30 a.m.
- Redbook at 8:55 a.m.
- FHFA House Price Index at 9 a.m.
- PMI Manufacturing Index Flash at 9:45 a.m.
- New Home Sales at 10 a.m.
- Richmond Fed Manufacturing Index at 10 a.m.
- 4-Week Bill Auction at 11:30 a.m.
- 2-Year Note Auction at 1 p.m.
Money Morning Tip of the Day: You can profit whether the Fed raises rates in June, October, or next year by owning stocks that are capable of withstanding rate shock.
As expected, the U.S. Federal Reserve didn't raise interest rates at its Federal Open Market Committee meeting that wrapped up last Wednesday. Fed Chairwoman Janet Yellen said the central bank will not hike rates until it sees more improvement in the employment situation and higher inflation in the months ahead.
But the central bank did remove the word "patient" in describing its stance on how it will approach interest rates in the coming months.
Now, investors are scrambling to determine the Fed's timeline and position accordingly.
As Money Morning Chief Investment Strategist Keith Fitz-Gerald recently explained, the best way to prepare for a Fed rate hike - whenever it may happen - is to invest in companies that supply services and products that are indispensable to humanity. Such companies are recession-resistant, even immune.
Here are two to get you started...
Becton, Dickinson and Co. (NYSE: BDX) develops, manufactures, and sells medical supplies and devices, diagnostic products, and lab equipment. It taps into Demographics, one of Fitz-Gerald's six Unstoppable Trends, as the aging global population will create a huge demand for BDX's healthcare services. It offers a dividend yield of 1.70%.
American Water Works Company Inc. (NYSE: AWK) provides water and wastewater services to residential, commercial, and public consumers in the United States and Canada. Everyone relies on running water, so AWK is a perfect "must have." Demand for its services will increase as the world's population grows. Its dividend yield is 2.40%.
Keith Fitz-Gerald shared a third "Fed rate hike-proof" stock to buy. You can get it here: Rising Rates Are a "Wild Card." Here's How to Play It...
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.