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Following U.S. Federal Reserve Chairwoman Janet Yellen's indecipherable message during yesterday's FOMC meeting, the Dow Jones Industrial Average finished up 72 points Wednesday. The Fed maintained interest rates at their current levels and reduced the number of increases that the FOMC committee expects for the rest of the year. In a somewhat rambling post-FOMC conference, Yellen touted job growth (4.9% employment rate), spoke extensively about the "Phillips Curve," and later signed off with the message that the Federal Reserve is not considering negative interest rates as a policy decision.
And here's the top stock market news, stocks to watch, and economic calendar for March 17, 2016.
What's Moving the Dow Jones Industrial Average Today: Global Oil Prices
Dow futures forecast a 38-point decline as traders digested yesterday's FOMC meeting and attempted to make any sense of Janet Yellen's answers to questions from the financial media.
Here's a breakdown of why the Dow is dipping this morning.
- This morning, the U.S. dollar slumped against global currencies as traders slowly began to understand that Fed Chairwoman Janet Yellen appears willing to allow the dollar to outpace the central bank's target inflation level. After a very confusing post-FOMC conference, analysts explained that the Federal Reserve has reduced the expected number of rate hikes down from four to two.
- Money Morning Chief Investment Strategist Keith Fitz-Gerald joined "Closing Bell" on CNBC after Yellen's conference to offer his insight on the Fed's actions now and up ahead. "I think the international central banks are doing the dirty work for [Janet Yellen]," he said. "Japan made its move, China made its move, and Europe made its move with its bazooka. They are making it impossible for the Fed to raise interest rates." Keith's statement was bolstered this morning after the Bank of England announced plans to keep its benchmark interest rate at a record low of 0.5%.
- "Too Big to Fail?" How about "Too Big to Care?" JPMorgan Chase & Co. (NYSE: JPM) and Citigroup Inc. (NYSE: C) shareholders will receive the opportunity to decide by vote in 2016 on whether these two megabanks should break up into smaller firms, according to The Wall Street Journal. The firms have added both voting questions to their proxy filings for shareholder review this year. But Bernie Sanders supporters shouldn't get their hopes up. Last year, Bank of America Corp. (NYSE: BAC) shareholders faced a similar proposal, and just 4% of voters supported the measure.
- Oil prices ticked toward a new 2016 high after a group of OPEC and non-OPEC nations – representing 73% of global oil trade – said they will have a meeting in April to discuss a global output freeze. The 15 nations will not rely on Iran to attend.
- On the economic front, initial jobless claims registered at 265,000 for last week. The figure beat consensus expectations by about 3,000.
Now here's your list of top stocks to watch in today's market, plus today's economic calendar:
Companies to Watch in the Stock Market Today
- Bill Ackman's position on Valeant Pharmaceuticals International Inc. (NYSE: VRX) continues to deteriorate, and that's not spreading to his portfolio's other positions as he's selling shares in order to cover his falling stake in the Canadian drug maker. Shares of Mondelez International Inc. (Nasdaq: MDLZ) fell 2.2% after Ackman cut his stake in the global snack maker back to 5.6%, a decision that required the sale of 20 million shares. In an effort to reduce investor concerns about the firm's cash position, Ackman sent a letter to investors on Wednesday stating that they have no other plans to sell shares from their other positions, citing "substantial uninvested cash."
- Shares of FedEx Corp. (NYSE: FDX) surged more than 5.7% after the company beat third-quarter earnings expectations. The firm reported an EPS of $2.51, easily topping Street per-share expectations of $2.34. The company's strong quarterly performance helps alleviate concerns about commerce during the year-ending quarter.
- Caterpillar Inc. (NYSE: CAT) announced that the firm expects first-quarter earnings and revenue will come in lower than Wall Street anticipates. The heavy equipment maker cited increased pressure from falling commodity prices. However, the firm is holding in place with its current full-year forecast as it expects commodity prices to slowly rise.
- Additionally, on the earnings side, pay attention to quarterly performance reports from Adobe Systems Inc. (Nasdaq: ADBE), Aeropostale Inc. (NYSE: ARO), and Lands' End Inc. (NYSE: LE).
Today's U.S. Economic Calendar (all times EST)
- Jobless Claims at 8:30 a.m.
- Philadelphia Fed Business Outlook Survey at 8:30 a.m.
- Current Account at 8:30 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- JOLTS at 10 a.m.
- Leading Indicators at 10 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- 3-Month Bill Announcement at 11 a.m.
- 6-Month Bill Announcement at 11 a.m.
- 2-Year FRN Note Announcement at 11 a.m.
- 10-Year TIPS Auction at 1 p.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
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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.