U.S. consumer spending increased by 0.3% in July, matching economists' expectations.
Meanwhile, inflation is rising. The personal consumption expenditures (PCE) price index, the central bank's preferred inflation measure, increased by 0.1% during July. The index has increased to 1.6% over the last year, shifting closer towards the Fed's target of 2%. On Friday, Federal Reserve Chair Janet Yellen suggested that the central bank may alter its inflation targets when considering a change to interest rates or other matters related to monetary policy. While markets are speculating on the timing of the next rate hike, all eyes will be on the U.S. Labor Department this week. On Friday, the federal agency will announce the unemployment rate for the month of August.
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Let's look at the final numbers on Monday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 18,502.99; 107.59; 0.58%
S&P 500: 2,180.38; 11.34; 0.52%
Nasdaq: 5,232.33; 13.41; 0.26%
Here's a look at today's most important market events and stocks, plus a preview of tomorrow's economic calendar.
The Dow gained more than 107 points after a strong performance from financial stocks and material stocks. The Dow received a solid boost from Wells Fargo & Co. (NYSE: WFC), which gained more than 2.5%. Shares JPMorgan Chase & Co. (NYSE: JPM), Bank of America Corp. (NYSE: BAC), and Goldman Sachs Group Inc. (NYSE: GS) all ticked up more than 1% on the day.
Financial stocks pushed higher due to increased expectations of a Fed rate hike in September. The odds of a rate hike have surged over the last week after Federal Reserve Chair Janet Yellen's speech in Jackson Hole. Money Morning Capital Wave Strategist Shah Gilani offers three ways investors can make sure that their savings continue no matter what the Fed decides to do with interest rates. Read his insight, right here.
Oil prices were sliding again on Monday on news that OPEC production continues to rise. Investors are increasingly worried about another supply glut weighing on prices. The West Texas Intermediate (WTI) crude oil price today fell 1.4%, while the Brent crude oil price slipped 1.3%. Here's more on why crude oil prices were falling on Monday.
Investors continue to speculate on the possibility of a production freeze by OPEC. The global oil cartel is set to meet in September to discuss a possible cut to global output. However, Money Morning Global Energy Strategist Dr. Kent Moors has said that investors shouldn't anticipate a deal next month. Moors argues that a deal is coming, but it won't be the type that traders are hoping for in September. Here's his inside scoop on when and how OPEC will reach a deal.
But the big story today was happening in the legal offices of Apple Inc. (Nasdaq: AAPL). According to Reuters, the European Commission is set to rule against the company's tax deal with Ireland and could slap the technology giant with a penalty of more than 1 billion euros in back taxes.
Now, let's look at the stocks you need to know about today...
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.