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The Dow Jones Industrial Average gained 18 points despite a troubled day of earnings reports, weak auto sales, and sharp declines in oil prices.
Markets received a slight boost from improving economic data in China, where a surprise expansion of the manufacturing segment bolstered trader sentiment. Unfortunately, the U.S. manufacturing base contracted last month for the first time in six months. A monthly report from the Institute of Supply Management raised concerns about third-quarter growth at a time that GDP is already expanding at an anemic rate.
The markets appear to be in a holding pattern ahead of a critical announcement on the U.S. jobs market on Friday. Everyone is waiting for the August unemployment report from the U.S. Labor Department. According to surveys, the consensus of economists calls for a slowdown in hiring for the month of August after two solid reports for June and July. With no major U.S. companies set to report earnings tomorrow, expect the Federal Reserve to dominate the trading day.
Let’s look at the final numbers on Tuesday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 18,419.30; 18.42; 0.10%
S&P 500: 2,170.86; -0.09; -0.00%
Nasdaq: 5,227.21; 13.99; 0.27%
Here’s a look at today’s most important market events and stocks, plus a preview of tomorrow’s economic calendar.
DJIA Today: Traders Await August Jobs Report While Oil Prices Slump
The Dow Jones held its head above water despite a sharp decline in oil prices on Friday. Crude oil prices fell to a three-week low as concerns about a U.S. supply glut weighed on trader sentiment. The price of WTI crude fell by 2.7%, while the price of Brent crude was off 2.6%. Traders brushed aside hope of a production freeze by members of OPEC later this month. Instead, they focused on the surprise jump in domestic crude supplies reported by the U.S. Energy Information Administration on Wednesday.
It was a busy – and tough – day for companies reporting earnings. This morning, Costco Wholesale Corp. (Nasdaq: COST) fell well short of Wall Street quarterly sales numbers. Meanwhile, shares of Campbell Soup Co. (NYSE: CPB) fell more than 4.5% after the food giant fell short of Wall Street quarterly profit and revenue estimates. The firm expressed disappointment over "execution issues" that plagued the Campbell Fresh division.
After the bell, look out for earnings reports from Lululemon Athletica Inc. (Nasdaq: LULU), Ambarella Inc. (Nasdaq: AMBA), Broadcom Ltd. (Nasdaq: AVGO), Smith & Wesson Holding Corp. (Nasdaq: SWHC), and VeriFone Systems Inc. (NYSE: PAY).
In deal news, shares of Hewlett Packard Enterprise Co. (NYSE: HPE) gained more than 3.1% on news that the firm is considering a deal to sell its software division to buyout giant Thoma Bravo LLC for between $8 billion and $10 billion.
But the big story today was the bombshell report that the United States allowed secret loopholes in its nuclear agreement with Iran. It turns out that last year's landmark Iran nuclear deal between Washington, Tehran, and other world powers included a few provisions that were kept from the public. Here’s what it means to the world and how the deal impacts the global oil markets.
Now, let’s look at the stocks you need to know about today…
Top Stock Market News Today, Sept. 1, 2016
- Shares of Facebook Inc. (Nasdaq: FB) were up 0.1% despite news that its Internet satellite exploded at launch this morning at the Cape Canaveral space center in Florida. While the rocket explosion did little to impact FB stock, it was a blow to SpaceX, a project run by Elon Musk. Shares of Musk’s firm Tesla Motors Inc. (Nasdaq: TSLA) fell by more than 5.3% on the day.
- Shares of Goldman Sachs Group Inc. (NYSE: GS) retreated on Thursday despite increased optimism that the Federal Reserve will hike interest rates in 2016. The stock is under a little bit of pressure after a report from CML News indicated that the companies’ revenues are trending lower. But that’s not the only reason to be skittish about Goldman these days. Money Morning Capital Wave Strategist Shah Gilani explains that you can become a partner of this iconic Wall Street bank for just $1. Shah explains that you should avoid this deal at all costs.
- Shares of Apple Inc. (Nasdaq: AAPL) were gaining after CEO Tim Cook criticized the European Commission's ruling that his firm must pay roughly $14.5 billion in unpaid taxes and penalties. Cook said the firm plans to repatriate billions of dollars back to the United States in 2016 while dubbing the EU ruling "total political crap." Despite this ruling, Apple is one of the best and most profitable companies in the world. Here’s why we are ranking AAPL stock a “Buy.”
Tomorrow’s U.S. Economic Calendar (all times EDT)
- Employment Situation at 8:30 a.m.
- International Trade at 8:30 a.m.
- Factory Orders at 10 a.m.
- Baker Hughes Rig Count at 1 p.m.
- Richmond Federal Reserve Bank President Jeffrey Lacker speaks at 1 p.m.
Up Next: September is historically the worst month for stock markets. That's why we advise investors to be particularly selective. If you're looking to profit, these are the stocks you need to own.
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.