Stock Futures Today
Futures for the Dow Jones today forecasted a 170-point gain from Wednesday's close as Chinese stocks rebounded and investors continue to hold out hope that Greece will be able to salvage a debt deal by Sunday's new deadline.
Yesterday (Wednesday), the DJIA lost more than 261 points after a technical glitch created an outage on the New York Stock Exchange. The trading glitch rattled domestic investors – many who sat out the final hour of buying and selling – when markets are already on edge over concerns regarding Greek and Puerto Rican debt and the ongoing freefall in the Chinese stock markets. Volumes were extremely low after trading restarted at 3:10 p.m. Wednesday's unexpected almost four-hour closing came without warning. It left investors confused – even panicked – and asking the question, "Why did the NYSE shut down?"
Top News in the Stock Market Today
- The Stock Market Today: This morning, investors will await three speeches from members of the Federal Reserve, an update on weekly jobless claims, and an inventory update to U.S. natural gas stocks. Most of the oxygen was sucked out of the markets yesterday after the glitch hit the NYSE. However, traders will likely begin to parse through the FOMC minutes that were released on Wednesday. According to the minutes, just one of the 10 Fed officials who have a vote this year hinted preparation for a June rate hike. However, the official said they would be willing to wait for one or two more meetings before pushing harder for tighter monetary policy.
- China Onslaught: The Federal Reserve's monetary policy decisions are being pushed to the back page behind events in Greece and China's major stock slump. Today, it's another day to keep a keen eye on firms that have significant exposure to the Chinese market. This includes firms like Yahoo Inc. (Nasdaq: YHOO) and Yum Brands Inc. (NYSE: YUM), which both fell more than 2.5% yesterday. In addition, investors are also paying attention to Alibaba Group Holding Ltd. (NYSE: BABA), which fell more than 2.1% and continues to decline despite the firm's long-term potential. Problems have grown so bad for the markets in China that the country has banned shareholders with large stakes of the nation's listed companies from selling their stakes.
- Oil Outlook: Oil prices were back on the rise despite concerns about oversupply and ongoing financial challenges in China. Traders around the globe pushed crude prices higher on news that gasoline demand has been higher than previously expected. WTI crude futures for August ticked up 3% this morning to hit $53.20 per barrel. Meanwhile, Brent prices added 3.1% to hit $58.83 per barrel.
- Earnings Reports: Companies reporting earnings this morning include Barracuda Networks Inc. (Nasdaq: CUDA), PepsiCo Inc. (NYSE: PEP), PriceSmart Inc. (Nasdaq: PSMT), Synergy Resources Corp. (Nasdaq: SYRG), and VOXX International Corp (Nasdaq: VOXX).
Pre-Market Movers in the Stock Market Today: AA, DRI, PEP
- Pre-Market Movers No. 1, AA: Shares of Alcoa Inc. (NYSE: AA) were up in pre-market hours after the company's quarterly revenue slightly topped analyst expectations. This morning's 0.5% gain follows a 5.1% decline during Wednesday's trading session. The company reported a second-quarter revenue stream of $5.9 billion, while Wall Street anticipated $5.8 billion. The company cited stronger than expected growth in its auto and aerospace divisions.
- Pre-Market Movers No. 2, DRI: The turnaround effort for Darden Restaurants Inc. (NYSE: DRI) continues. The restaurant operator announced that it has hired former Wal-Mart Stores Inc. (NYSE: WMT) financial executive Jeffrey Davis to its role as CFO. Davis will assume the role on July 16 and will succeed Brad Richmond, who will be retiring.
- Pre-Market Movers No. 3, PEP: Shares of PepsiCo Inc. (NYSE: PEP) were up 2.4% in pre-market trading on news that the company reported stronger than expected profit and revenue figures than Wall Street expected. The company reported a per-share quarterly profit of $1.32, which beat consensus expectations by $0.08. In addition, the global beverage and snack giant raised its 2015 profit outlook, but cautioned that a stronger dollar could rattle expectations down the line.
Stocks to Watch Today: AAPL, YHOO
- Stocks to Watch No. 1, AAPL: Global tech giant Apple Inc. (Nasdaq: AAPL) saw shares fall another 2.5% on concerns about sales of its new product the Apple Watch. According to Slice Intelligence, Apple's watch sales have fallen by 90% since its opening week, and most of its sales have come from its lower-profit Sport line. In addition, investors are worried about the impact of China's sharp stock decline on consumers' discretionary spending levels in the country where the firm's products remain highly popular. The firm has responded to worries about its future profitability by announcing plans to produce a record number of iPhones when it begins the manufacturing of its next-generation smartphone. Shares were up nearly 1% in pre-market trading.
- Stocks to Watch No. 2, YHOO: Shares of Yahoo Inc. were down 2.6% on Wednesday despite a bold announcement to launch services catering to daily fantasy sports contests. The company will compete against private giants DraftKings and FanDuel by providing daily contests and taking a 10% cut of all games on its site. The opportunity could be huge for Yahoo, which is reeling in the wake of Alibaba's stock decline. This morning, Yahoo stock was up 2.6%.
Today's U.S. Economic Calendar (all times EDT)
- Minneapolis Federal Reserve Bank President Narayana Kocherlakota speaks at 5:45 a.m.
- Jobless Claims at 8:30 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- Federal Reserve Governor Lael Brainard speaks at 10 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- 3-Month Bill Announcement at 11 a.m.
- 6-Month Bill Announcement at 11 a.m.
- Kansas City Federal Reserve Bank President Esther George speaks at 12:30 p.m.
- 30-Year Bond Auction at 1 p.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
What Investors Must Know This Week
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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.