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Unless a significant event happens, look for the Dow Jones Industrial Average today to take a bit of a breather as investors prepare for tomorrow's release of the February jobs report. While a weekly jobless report will offer some hint of what we might expect tomorrow, the unemployment rate is likely to have a significant impact on the U.S. Federal Reserve's pending decision on interest rates on March 16.
With so much happening this morning, let's tackle your top stock market news, stocks to watch, and economic calendar for March 3, 2016.
Dow Futures Today
Dow Jones futures forecast a 13-point decline as investors prepare for tomorrow's monthly jobs report.
Here's a breakdown of why traders are being cautious this morning:
- A strong jobs report tomorrow could fuel expectations that the Federal Reserve will boost interest rates at some point this year. According to CME FedWatch, traders anticipate a 61% probability that the central bank will hike rates in 2016.
- Last year, Money Morning Capital Wave Strategist Shah Gilani warned investors that a surge in subprime loans could damage the financial sector. Well, heed the warning. Reuters reports this morning that Bank of America Corp. (NYSE: BAC) is significantly boosting its auto loan business, despite warnings from its rivals. In the fourth quarter, U.S. banks said that roughly $1.1 billion in auto loans were deemed uncollectible, according to the Federal Deposit Insurance Corp. This should end well…
- Somewhere, activist investor Bill Ackman is smiling and enjoying his breakfast. That's because shares of Herbalife Ltd. (NYSE: HLF) fell nearly 15% this morning after the firm announced that its new membership figures were overstated.
- As we've said repeatedly, the low-interest-rate environment is fueling more and more merger and acquisition activity. This morning, shares of Tumi Holdings Inc. (NYSE: TUMI) swelled more than 17% on news that Samsonite International is exploring a deal to purchase the rival luggage maker.
- Oil prices are on an absolute tear, rising 35% in the last month. However, this morning, crude oil prices slipped slightly as concerns about global oversupply weighed on trader sentiment. Yesterday, the U.S. Energy Information Administration reported that crude inventories surged by more than 10 million barrels last week. Overall, U.S inventory levels hit a new record of roughly 518 million barrels.
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 SunEdison Inc. (NYSE: SUNE) fell in pre-market hours after the renewable energy giant announced plans to suspend its quarterly dividend on preferred stock. The firm is under pressure from lenders – who are withholding funding for its pending purchase of Vivint Solar. Shares of Vivant were up 3% this morning.
- The short sellers are on the attack, but TSLA stock remains a strong long-term buy. Yesterday, shares of Tesla Motors Inc. (Nasdaq: TSLA) came under pressure. Don't buy the hype. The stock remains a buy, here's why.
- Shares of Chesapeake Energy Corp. (NYSE: CHK) pared gains in after-hours trading yesterday after surging as much as 33% during the normal session. The decline came shortly after news broke that the firm's former founder and CEO Aubrey McClendon died in a single-car crash. His death occurred one day after the Federal government charged McClendon for conspiring to rig oil and natural gas bids and violating antitrust laws.
Today's U.S. Economic Calendar (all times EST)
- Challenger Job-Cut Report at 7:30 a.m.
- Jobless Claims at 8:30 a.m.
- Productivity and Costs at 8:30 a.m.
- Gallup Good Jobs Rate at 8:30 a.m.
- PMI Services Index at 9:45 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- Factory Orders at 10 a.m.
- ISM Non-Manufacturing Index at 10 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- Dallas Federal Reserve Bank President Rob Kaplan speaks at 10:45 a.m.
- 3-Month Bill Announcement at 11 a.m.
- 6-Month Bill Announcement at 11 a.m.
- 3-Year Note Announcement at 11 a.m.
- 10-Year Note Announcement at 11 a.m.
- 30-Year Bond Announcement at 11 a.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
With futures down this morning, investors wonder if we're heading 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
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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.