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Good morning! For Friday, Oct. 16, 2015, here is the top news affecting the Dow Jones Industrial Average today, including stock market futures, earnings reports, and stocks to watch…
Stock Futures Today
U.S. stock futures were mixed this morning as companies continue to post earnings reports and underwhelm investors – largely due to weakness in Chinese markets. At 9:15 a.m. ET, Dow futures were down 16 points (-0.09%), Nasdaq futures rose 1.25 points (+0.03%), and S&P 500 futures fell 1.75 points (-0.09%).
China, the world's second-biggest economy, continues to show signs of slowing. German fashion brand Hugo Boss (OTCMKTS: BOSSY) tanked 10% in London today after cutting its sales outlook due to headwinds in China. Earlier this week, two other high-end luxury retailers, Burberry Group Plc. (LON: BBRYF) and Louis Vuitton (OTCMKTS: LVMHF), both blamed China for weaker sales.
Earlier this week on Wednesday, we saw the effects of bad earnings on U.S. markets. Wal-Mart Stores Inc. (NYSE: WMT), which has the greatest weight of any company on the Dow, released poor earnings guidance. WMT stock slumped 10%, marking its worst one-day decline since 1988. As a result, the Dow and S&P 500 closed down 157.14 points and 9.45 points, respectively.
Top News in the Stock Market Today
- The Stock Market Today: Traders today will keep an eye out for a monthly update to industrial production, the weekly JOLTS index, an update on domestic oil production, and a report on consumer sentiment.
- Oil Outlook: Oil prices were up this morning, reversing a weeklong decline in prices. Oil prices have declined by almost 10% this week as concerns about a global supply glut reemerged. November futures for WTI crude were up 0.6% to $46.66 per barrel, while Brent crude added 0.2% to $49.83.
Earnings Outlook: GE, HON, ATHN, GWW, KSU, PGR
- Earnings Reports No. 1, GE: Before the bell, General Electric Co. (NYSE: GE) beat earnings expectations by $0.03 despite a revenue miss. The company reported third-quarter EPS of $0.29, as it continues to sell its financial assets and focus on its industrial businesses. GE said that falling oil prices have negatively affected its oil and gas sales, but locomotive and aircraft orders offset declines.
- Earnings Reports No. 2, HON: Earlier, Honeywell International Inc. (NYSE: HON) beat Wall Street third-quarter profit estimates by $0.05. The company reported earnings of $1.60 per share. HON's quarterly revenue clocked in at $9.61 billion, down from expectations of $9.85 billion.
- Additional companies reporting earnings include athenahealth Inc. (Nasdaq: ATHN), W.W. Grainger Inc. (NYSE: GWW), Kansas City Southern (NYSE: KSU), and Progressive Corp. (NYSE: PGR).
Pre-Market Movers: ZFGN, YOKU, VRX, TMUS, YUM
- Pre-Market Movers No. 1, ZFGN: Shares of Zafgen Inc. (Nasdaq: ZFGN) cratered more than 33% after the company said that the FDA placed its new obesity drug trial on a "clinical hold."
- Pre-Market Movers No. 2, YOKU: Shares of Youku Tudou Inc. (NYSE ADR: YOKU) surged more than 22.2% on news that Alibaba Group Holding Ltd. (NYSE: BABA) offered to purchase the video-streaming firm for $26.60 per share. The news pushed BABA stock up more than 1%.
- Pre-Market Movers No. 3, VRX: Shares of Valeant Pharmaceuticals International Inc. (NYSE: VRX) slipped nearly 5% after the company officially received subpoenas from U.S. prosecutors. The pharmaceutical giant – backed by activist investor Bill Ackman – is under intense scrutiny over how it processes its drugs and distributes them to patients. As Money Morning Global Credit Strategist Michael Lewitt explains, this biotech company represents everything wrong with the financial markets. Here's why the stock is a terrible investment.
- Pre-Market Movers No. 4, TMUS: Telecom giant T-Mobile US Inc. (NYSE: TMUS) announced that it plans to switch its stock listing from the NYSE to Nasdaq on Oct. 27.
- Pre-Market Movers No. 5, YUM: Shares of Yum! Brands Inc. (NYSE: YUM) were up 2% this morning after the company added activist investor Keith Meister to its board and slashed its full-year financial forecast. Meister has pushed for the company to spin off its struggling business in China. The firm said that its forecast has been crushed by a rising U.S. dollar.
Today's U.S. Economic Calendar (all times EDT)
- Industrial Production at 9:15 a.m.
- JOLTS at 10 a.m.
- Consumer Sentiment at 10 a.m.
- Atlanta Fed Business Inflation Expectations at 10 a.m.
- Baker-Hughes Rig Count at 1 p.m.
- Treasury International Capital at 4 p.m.
What Investors Must Know This Week
- The Fastest Way to Profit from a $709 Billion Industry Shift
- Five Tech Stocks That Soared While the Markets Tanked
- Here's Where the Next Oil Sector Profits Will Be Made
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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.