For Jan. 6, 2016, here's the top stock market news and stocks to watch…
Stock Futures Today
Futures for the Dow Jones Industrial Average today (Wednesday) slumped another 298 points after a North Korean missile test raised geopolitical concerns and oil prices fell to an 11-year low. Reports indicate North Korea tested a hydrogen bomb, another global concern in the wake of rising Saudi-Iranian tensions.
Make no mistake about it: The recent interest rate hike and rising geopolitical tensions are just the opening chapter to a year of coming volatility. Money Morning Capital Wave Strategist Shah Gilani explains the secret strategies you can employ to make money during this volatile year. Check it out, right here.
Yesterday, the Dow Jones Industrial Average added 9 points despite another wild trading session. The Dow stabilized on news the People's Bank of China injected roughly $20 billion into the nation's struggling financial system in order to reduce concerns after Monday's 7% slump on the Shanghai Composite Index.
Top News in the Stock Market Today
- The Stock Market Today: The markets will continue to react to global macro events that have pushed the markets down significantly during the first week of trading in 2016. On the economic front, traders are eyeing December's non-manufacturing services report, November updates on trade and durable goods orders, and the December ADP employment report. Finally, the U.S. Federal Reserve will release minutes from its December meeting where it raised interest rates for the first time since 2006.
- China Troubles: Markets again soured on weak economic data in China. This morning, the People's Bank of China lowered its currency's – the yuan – official midpoint rate to the lowest level in more than four years. Meanwhile, the nation's December services sector PMI survey increased at its lowest rate since mid-2014.
- Oil Outlook: Oil prices fell to an 11-year low as tensions between Saudi Arabia and Iran accelerated this week after the Saudi government executed a Shiite cleric. After the Saudis cut diplomatic ties with Iran, the Saudi foreign minister fanned the flames by declaring that "Iranians have got away with murder, literally, for more than 30 years." February WTI prices were down 3.6% at $34.67 per barrel. Meanwhile, Brent oil crude – priced in London – was off 4.5% at $34.77. The geopolitical tension between Iran and Saudi Arabia has spilled over to other countries in the region, and Money Morning Global Energy Strategist Dr. Kent Moors has raised significant concerns about Bahrain – a tiny nation off the Saudi Eastern Province that has erupted in protest. Here's why.
Earnings Outlook: MON, UNF, GBX, AKRX, RPM, MSM
- Earnings Report No. 1, MON: Shares of Monsanto Co. (NYSE: MON) were off 0.5% after the company reported fiscal first-quarter earnings. The agricultural giant reported a per-share loss of $0.11, beating Wall Street expectations of a loss of $0.24 per share. However, revenue figures came in lower than expected. The firm reported a Q1 bottom line of $2.2 billion when Wall Street expected $2.5 billion.
- Earnings Report No. 2, UNF: Before the market opens, investors will hear first-quarter earnings from UniFirst Corp. (NYSE: UNF). The company is expected to report per-share earnings of $1.64 on top of $371.5 million.
- Additional companies set to report earnings today include Greenbrier Companies Inc. (NYSE: GBX), Akorn Inc. (Nasdaq: AKRX), RPM International Inc. (NYSE: RPM), and MSC Industrial Direct Co. Inc. (NYSE: MSM).
Stocks to Watch: AAPL, VRX, YHOO
- Stocks to Watch No. 1, AAPL: Shares of Apple Inc. (Nasdaq: AAPL) fell below $100 in pre-market hours and remain down 2.5% ahead of the bell. The tech giant's stock is sliding after the Nikkei Asian Review reported Apple will slash its iPhone production by roughly 30% this quarter.
- Stocks to Watch No. 2, VRX: Shares of Valeant Pharmaceuticals International Inc. (NYSE: VRX) slumped nearly 3% after the company announced plans to appoint CFO Howard Schiller as interim CEO to replace Michael Pearson, who was recently hospitalized and is recovering from a bout of pneumonia. Last week, news indicated activist investor Bill Ackman slashed his holdings of the Canadian biotech giant in order to harvest tax losses for his investors.
- Stocks to Watch No. 3, YHOO: Shares of Yahoo! Inc. (Nasdaq: YHOO) are under pressure this morning after activist investor Starboard Value called for management changes and for the tech giant to spin off its core online business. The company said in a letter that the past year has been especially frustrating for shareholders, which suggests they have lost confidence in the company's CEO Marissa Mayer.
Today's U.S. Economic Calendar (all times EST)
- MBA Mortgage Applications at 7 a.m.
- ADP Employment Report at 8:15 a.m. aa
- International Trade at 8:30 a.m.
- Gallup U.S. Job Creation Index at 8:30 a.m.
- PMI Services Index at 9:45 a.m.
- Factory Orders at 10 a.m.
- ISM Non-Manufacturing Index at 10 a.m.
- EIA Petroleum Status Report at 10:30 a.m.
- FOMC Minutes at 2 p.m.
What Investors Must Know This Week
- The Best Market Crash Insurance You Can Buy
- Grab Triple-Digit Gains from This "Stealth" Tech Star
- The Real Reason for China's Insatiable Gold Lust
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.