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For Oct. 20, 2015, here are your stock market futures, earnings reports, top stock market news, and stocks to watch…
Stock Futures Today
Futures for the Dow Jones Industrial Average today (Tuesday, Oct. 20) were down 16 points this morning as markets prepare for a speech by U.S. Federal Reserve Chairwoman Janet Yellen, who is expected to offer some insight into the central bank's outlook on monetary policy. Markets predict there is a 31% chance that the central bank will hike rates in 2015. The odds are more in favor of a rate hike in March 2016.
On Monday, the Dow Jones Industrial Average was flat most of the session, but finished 14.5 points higher as traders digested economic data from China and a number of financial earnings reports. A decline in oil prices was exacerbated by new data that suggests demand is slipping in China.
Top News in the Stock Market Today
- The Stock Market Today: Today, the focus will be on a speech by Fed Chairwoman Janet Yellen and a statement by New York Federal Reserve Bank President William Dudley. Keep an eye on a monthly report on housing starts. In addition, keep an ear out for a speech by Bank of Canada Governor Mark Carney, who will offer some insight into the country's monetary policy decision. The news follows a shocking election victory by the new Prime Minister Justin Trudeau, who led a major victory for the nation's Liberal Party during yesterday's national election.
- Oil Outlook: Oil prices were up slightly this morning as traders cover their short bets, while economic concerns about China and global demand weakness raise concerns about prices. November futures for WTI crude were up about 0.5%, while Brent crude added 0.3%. Falling oil prices are putting increased pressure on oilfield service companies. Yesterday, shares of Halliburton Co. (NYSE: HAL) slumped more than 1.2% after the company reported weak third-quarter earnings. The poor report dragged down shares of rivals like Transocean Ltd. (NYSE: RIG) and Marathon Oil Corp. (NYSE: MRO), both of which slumped more than 4.5% on Monday.
Earnings Outlook: YHOO, CMG, LMT, VMW, DFS, HOG, VZ
- Earnings Reports No. 1, YHOO: After the bell, Yahoo! Inc. (Nasdaq: YHOO) will report fiscal third-quarter earnings. Consensus expectations call for earnings of $0.15 per share on top of $1.02 billion in revenue.
- Earnings Reports No. 2, CMG: After the bell, Chipotle Mexican Grill Inc. (NYSE: CMG) will report fiscal third-quarter earnings. Wall Street analysts anticipate the casual dining giant will declare an EPS of $4.62 on top of $1.21 billion in revenue.
- Earnings Reports No. 3, LMT: Shares of Lockheed Martin Corp. (NYSE: LMT) will be in focus when the defense company reports earnings before the bell. The company is expected to report an EPS of $2.70 and revenue of $11.04 billion.
- Additional companies reporting earnings include VMware Inc. (NYSE: VMW), Intuitive Surgical Inc. (Nasdaq: ISRG), Discover Financial Services (NYSE: DFS), Verizon Communications Inc. (NYSE: VZ), and Harley Davidson Inc. (NYSE: HOG).
Pre-Market Movers: IBM, BABA, UAL
- Pre-Market Movers No. 1, IBM: Shares of International Business Machines Corp. (NYSE: IBM) were dropping this morning after the company reported an 11% decline in its third-quarter bottom line. This was the 14th-straight quarter that IBM reported a decline in revenue. The firm also slashed its full-year profit outlook. The company said that a stronger U.S. dollar has hammered its demand levels in China and other emerging markets.
- Pre-Market Movers No. 2, BABA: Shares of Alibaba Group Holding Ltd. (NYSE: BABA) were up more than 0.7% on the day. Alibaba stock has been hot over the last month, gaining more than 22%. Just a few days ago, the e-commerce giant announced a $3.6 billion bid for Chinese video streaming site Youku Tudou Inc. (NYSE ADR: YOKU). Money Morning Executive Editor Bill Patalon explains that the best is yet to come for Alibaba stock.
- Pre-Market Movers No. 3, UAL: Shares of United Continental Holdings Inc. (NYSE: UAL) were ticking up this morning on news that it has named its general counsel Brett Hart as its interim CEO. The announcement follows word that CEO Oscar Munoz will be taking medical leave in the wake of a recent heart attack.
Today's U.S. Economic Calendar (all times EDT)
- Housing Market Index at 10 a.m.
- Housing Starts at 8:30 a.m.
- Redbook at 8:55 a.m.
- New York Federal Reserve Bank President William Dudley speaks at 9 a.m.
- Federal Reserve Chair Janet Yellen speaks 11 a.m.
- 4-Week Bill Auction at 11:30 a.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
Follow us on Twitter @moneymorning.
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.