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Dow Jones Industrial Average News, 6/06/2016: Central bankers at the U.S. Federal Reserve have egg on their face after Friday's dismal jobs report indicated that the health of the U.S. economy is not at the level of performance they'd been stating in recent weeks.
Although the cooked "official" unemployment rate hit 4.7% in May, the nation created just 38,000 jobs.
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Today, Fed Chair Janet Yellen will speak twice as traders have questions about her strategy moving forward with interest rates. The Fed chair is slated to give a speech later today at the World Affairs Forum of Philadelphia.
Earlier this morning, Boston Federal Reserve President Eric Rosengren called the weak jobs report an "anomaly."
Here's today's top stock market news, stocks to watch, ways to profit, and economic calendar for June 6, 2016.
What's Moving the Dow Jones Industrial Average Today: May Jobs Report
Dow Jones futures gained 36 points as traders' expectations for the next interest rate hike plunged after Friday's disappointing jobs report. In May, the U.S. economy added much fewer jobs than economists had expected, but consumer spending is booming at levels not seen since 2009.
Here's a breakdown of why the Dow is pushing higher this morning.
First up, the National Association for Business Economics cut its 2016 GDP expectations for the third month. NABE members now foresee U.S. growth slipping to a rather bleak 1.8%. That's a significant decline from the 2.2% the association had previously projected. The association cited concerns from the ongoing U.S. presidential election.
Swiss voters rejected a plan to guarantee $2,500 per month in basic income. On a plan that literally would have given every citizen money for nothing, roughly 80% of voters turned it down. Basic income guarantees (BIG) have been considered for decades, as former President Richard Nixon supported a similar plan in the 1970s. However, this formal vote will likely deter other nations from considering the plan for some time, even with concerns about robots replacing humans in the workforce continuing to accelerate.
On the banking front, investment firms on Wall Street are offering far greater employee-friendly policies. Goldman Sachs Group Inc. (NYSE: GS) said that it received 250,000 applications for summer jobs from students and graduates, news that suggests that the best and brightest are still angling for positions on Wall Street. Meanwhile, JPMorgan Chase & Co. (NYSE: JPM) announced plans to allow employees to dress business casual, a radical departure from previous policy, after the firm cited an increasing trend of dressing down by company clients.
Crude oil prices rallied again on Monday thanks to a slumping U.S. dollar and supply concerns after yet another attack on the oil infrastructure of Nigeria. Fleeting expectations of a rate hike pushed the dollar lower. Meanwhile, militants in Nigeria have sworn they will keep attacking the nation's energy rigs until they completely halt all production in the country. WTI crude oil was up 2.2%, while Brent crude added 2.1% and topped $50 per barrel.
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
- On the deal front, keep a close eye on shares of Monsanto Co. (NYSE: MON) today. Shares have been on a tear over the last week as German drug and chemical giant Bayer AG (OTCMKTS ADR: BAYRY) continues to bid for the agricultural giant. The latest offer of $62 billion would be the largest deal ever by a German company. However, investment periodical Barron's – over the weekend – issued a warning to investors and suggested they take the 17% gain from Monsanto in recent weeks. Barron's appears skeptical that a deal of such size would receive regulatory approval.
- Shares of Microsoft Corp. (Nasdaq: MSFT) are in focus after the software giant unveiled a new vision for its iconic Windows brand.
- Shares of Nordstrom Inc. (NYSE: JWN) are in focus today after concerns about the firm's ability to attract customers are rising. On Friday, shares fell about 3% in post-market hours. The stock is now off nearly 20% since Jan. 1.
- Look for additional earnings reports from United Natural Foods Inc. (Nasdaq: UNFI), Casey's General Stores Inc. (Nasdaq: CASY), Thor Industries Inc. (NYSE: THO), Calavo Growers Inc. (Nasdaq: CVGW), and Layne Christensen Co. (Nasdaq: LAYN).
Today's U.S. Economic Calendar (all times EDT)
- Boston Federal Reserve President Eric Rosengren speaks at 2:15 a.m.
- Gallup US Consumer Spending Measure at 8:30 a.m.
- Labor Market Conditions Index at 10 a.m.
- 4-Week Bill Announcement at 11 a.m.
- 3-Month Bill Auction at 11:30 a.m.
- 6-Month Bill Auction at 11:30 a.m.
- TD Ameritrade IMX at 12:30 p.m.
- Federal Reserve Chair Janet Yellen speaks at 12:30 p.m. and 2 p.m.
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.