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Buckle up, because oil-price volatility is front and center for the Dow Jones Industrial Average today. Futures forecast a small decline in early morning hours, but indices in Europe and Asia slumped again as global demand concerns weighed on investor sentiment. However, that's just a small part of what traders are chatting about this morning. Let's jump into top stock market news, stocks to watch, and economic calendar for Feb. 23, 2016.
Dow Futures Today
Futures for the Dow Jones Industrial Average indicated a 12-point decline at open as WTI oil prices slipped due to a potential glut of supply pouring out of Iran. With energy prices driving the market, expect traders to keep a close eye on a speech by Saudi Oil Minister Ali al-Naimi, who will be attending the CERAWeek energy conference in Houston today.
- The U.S. Federal Reserve is back in focus today and traders have very little clue about what the central bank plans to do about monetary policy and interest rates in the coming months. Speeches by Neel Kashkari (Minneapolis), Rob Kaplan (Dallas), and Fed Vice Chairman Stanley Fischer may offer some insight into the Fed's plans this year, but don't expect anything overly insightful until the March FOMC meeting. While the Fed is leaving investors in the dark, its policies are creating all sorts of problems in the markets. In fact, these four charts have traders talking – and worried – about where the markets go from here.
- In stunning news, global banking icon Standard Chartered Plc. reported its first annual loss since 1989. The bank, which has been undergoing a turnaround effort under CEO Bill Winters, saw loan impairments surge by nearly 100%. That pulled down European shares of the stock and could weigh heavily on U.S. banking stocks today as concerns about global debt remain in focus. In fact, now is the time to remain vigilant and start preparing for the day when banks start to raid customer deposits. You can start right here.
- Yesterday, the Dow rallied more than 228 points, and the Nasdaq popped nearly 1.5%. The markets rallied thanks to a huge announcement that two of the nation's largest defense companies – United Technologies Corp. (NYSE: UTX) and Honeywell International Inc. (NYSE: HON) explored a potential merger. However, new reports indicate that the deal was not completed due to regulatory concerns.
- Today's trading session will center on home prices. According to recent data, home-price appreciation is up roughly 6% year over year. Keep an eye on shares of homebuilders like KB Home (NYSE: KBH) and Toll Brothers Inc. (NYSE: TOL), the S&P/Case-Shiller Home Price Index, and a report on existing home sales.
Now here's your list of top stocks to watch in today's market, plus today's economic calendar:
Earnings and Stocks to Watch in Today's Market
- Shares of Home Depot Inc. (NYSE: HD) climbed more than 3% this morning after the company announced stronger than expected quarterly earnings. The company also announced plans to buy back $5 billion in stock and boost its dividend by 17%. The nation's top home-improvement chain said that a strengthening housing market fueled the strong earnings report, in addition to improving labor conditions and wage growth. Shares of rival Lowe's Companies Inc. (NYSE: LOW), which will announce quarterly earnings tomorrow, added more than 2.6% on the HD stock report.
- Investors were stunned by the news yesterday that Bank of America Corp. (NYSE: BAC) will disrupt the mortgage-lending business. The company's stock is still rallying after the firm unveiled a new mortgage product that would allow Americans to buy a home with as little as a 3% down payment. In addition, borrowers would be able to avoid private mortgage insurance, a deal that is far more favorable than what is available through the Federal Housing Administration.
- On the earnings front, expect quarterly reports from First Solar Inc. (Nasdaq: FSLR), Animation Skg Inc. (Nasdaq: DWA), and Papa John's International Inc. (Nasdaq: PZZA). Meanwhile, shares of Macy's Inc. (NYSE: M) surged more than 6% after the company beat Wall Street earnings expectations by a solid margin.
- Finally, shares of Fitbit Inc. (NYSE: FIT) were down more than 17% in pre-market activity after the company lowered forward guidance for the first quarter. The company said it expects quarterly revenue to come in between $420 million and $440 million. That is well under Wall Street expectations of $484.4 million. But don't let this forecast deter you from considering this stock today. Here's why Fitbit is a buy moving forward.
Today's U.S. Economic Calendar (all times EST)
- Redbook at 8:55 a.m.
- S&P Case-Shiller HPI at 9 a.m.
- Consumer Confidence at 10 a.m.
- Existing Home Sales at 10 a.m.
- Richmond Fed Manufacturing Index at 10 a.m.
- State Street Investor Confidence Index at 10 a.m.
- 4-Week Bill Auction at 11:30 a.m.
- 2-Year Note Auction at 1 p.m.
- Stanley Fischer speaks at 8:30 p.m.
Investors still want to know if we're headed for a stock market crash, correction, or bear market. Here's what our Money Morning experts predict will happen in 2016…
What Investors Must Know This Week
- The $600 Million Signal That Oil Prices Are About to Rise
- How to Prepare for a Global Recession in 2016
- This Easy Investing Strategy Can Lead to 2,426% Profits
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.