Today, the Dow Jones Industrial Average fell 91 points as traders expressed concerns about cratering oil prices and conditions in the Chinese, European, and U.S. economies. According to reports this morning, domestic factory activity slumped in July and consumer spending fell to its lowest levels in four months, raising new concerns about the broader health and momentum of the U.S. economy. Meanwhile, China's manufacturing activity fell more than expected this morning. The news dragged down stocks with broad exposure to the world's second largest economy.
The S&P 500 Volatility Index (VIX), the market's fear gauge, gained 5.2% on the day.
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Stock Market News: While falling oil prices were in focus, investors were also watching domestic data, manufacturing problems in China, and more developments in Greece, which reopened its stock market today for the first time in five weeks. The Athens Stock Exchange cratered more than 22% this morning on its first day of trading after the nation accepted a bailout package from its creditors last month.
Coal Craters: President Obama's Environmental Protection Agency is in the final stages of preparing new regulations that would require significant decreases in carbon emissions over the next decade. The news sent shares of coal stocks into a free fall as the new regulations would require a 30% reduction in carbon emissions from coal-fired power plants. Shares of Peabody Energy Corp. (NYSE: BTU) fell by 10%, shares of Cloud Peak Energy Inc. (NYSE: CLD) fell by 8.5%, and Arch Coal Inc. (NYSE: ACI) is likely teetering on bankruptcy, falling 90% today.
Oil Prices: Crude oil prices slid to six-month lows as oversupply fears continued to rattle the global markets. WTI crude futures for September slipped 3.6% to hit 45.39 per barrel. Meanwhile, Brent oil prices dipped nearly 5% to hit $59.62 per barrel. Falling demand in China was exacerbated by news that the nation's manufacturing activity unexpectedly slipped in July. Meanwhile, Reuters reported that Organization of the Petroleum Exporting Countries (OPEC) hit its highest monthly production level in years. Shares of Chevron Corp. (NYSE: CVX) fell another 3.3% on the day.
On Tap Tomorrow: On Tuesday, investors will continue to monitor a busy economic calendar including factory orders for the month of June and Gallup's Economic Confidence Index. Companies reporting earnings on Tuesday include Archer Daniels Midland Co. (NYSE: ADM), Coach Inc. (NYSE: COH), DreamWorks Animation SKG Inc. (Nasdaq: DWA), First Solar Inc. (Nasdaq: FSLR), Holly Energy Partners LP (NYSE: HEP), Kellogg Co. (NYSE: K), LendingClub Corp. (NYSE: LC), Mosaic Co. (NYSE: MOS), Walt Disney Co. (NYSE: DIS), Western Refining Inc. (NYSE: WNR), Zillow Group Inc. (Nasdaq: Z), Zoetis Inc. (NYSE: ZTS), and CVS Health Corp. (NYSE: CVS).
Stocks to Watch No. 1, F, GM: Shares of Ford Motor Co. (NYSE: F) and General Motors Co. (NYSE: GM) were up today on news major auto manufacturers reported stronger than expected sales in the month of July, erasing doubts about the sector's momentum after reporting weak June sales. Automakers are on pace to have their best annual sales figures in roughly a decade.
Stocks to Watch No. 2, TSN: Shares of Tyson Foods Inc. (NYSE: TSN) slipped nearly 10% after the meat producer announced per-share earnings of $0.80, falling well short of Wall Street estimates of $0.92. The company also reported weaker than expected revenue and slashed its 2015 outlook due to an increase in export disruptions. The company did report its prepared-foods sales surged more than 13% thanks to its recent acquisition of Hillshire Brands, a deal worth $8.55 billion.
Stocks to Watch No. 3, AAPL: Shares of Apple Inc. (Nasdaq: AAPL) slipped another 2.7% this afternoon after broader concerns about the Chinese economy weighed down the tech giant's stock. According to research firm Canalys, Apple lost market share in the second quarter in the smartphone industry. Despite concerns, many investors are optimistic about a report by International Business Times that indicates Apple is in discussions with network carriers in the United States and Canada to build its own mobile network to compete against others in the industry.
Stocks to Watch No. 4, TWTR: Shares of Twitter Inc. (NYSE: TWTR) dipped 5.7% to hit an all-time low today. The San Francisco-based company's stock first cracked the $30 mark just before noon and continued a downward decent. For a complete breakdown of the Twitter stock price's new lows, visit here.
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.
