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This morning, Dow Jones Industrial Average was pushing higher after the U.S. Labor Department reported the August unemployment rate and additional job-market data.
The verdict? Non-farm payrolls added just 151,000 jobs in August, well below the 180,000 consensus expectation among economists. The markets pushed higher as investors speculate that the Federal Reserve is unlikely to raise interest rates in September. This morning, economist Austan Goolsbee told CNBC that he doesn't think that this jobs report will push the Fed to act before the 2016 election.
Yesterday, the Dow 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 manufacturing expansion bolstered trader sentiment.
Let's take a look at Thursday's Stock Market Numbers:
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%
September is historically the worst month for stock markets. That's why we advise investors to be particularly selective. [Editor's Note: If you're looking to profit, these are the stocks you need to own.]
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected a 54-point gain despite the weakness of the August jobs report. The report puts the Federal Reserve in focus. Expect a lot of chatter today about the timing of the central bank's next interest-rate hike. The Fed is set to meet later this month and could raise rates for the first time since December 2015.
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So much speculation about interest rates and the Federal Reserve is not healthy for the markets. Money Morning Chief Investment Strategist Keith Fitz-Gerald explains that the U.S. central bank has morphed into an abomination. The Fed was originally designed to protect Americans and their deposits. But over the last 103 years, the central bank's interest has turned from protecting ordinary Americans to protecting the privileged big banks and crony capitalists. Here's Keith's latest insight on the dangers of the Fed policies, and what it means for your money.
Oil prices were on track for their largest weekly loss in eight months as traders eyed the growing supply glut in the United States. Prices were on the rise this morning after Russian President Vladimir Putin said he supported a production freeze among oil exporters to stabilize crude prices. This morning, the WTI crude price was up 0.8%, while Brent crude added 1.2%.
Today will be a busy day for the smartphone industry. First, Samsung Electronics announced that it will be stopping the sale of its Galaxy Note 7. The manufacturer announced that it has uncovered problems with its batteries. Meanwhile, its rival Apple Inc. (Nasdaq: AAPL) is prepping to launch its latest version of the iPhone 7.
If you haven't heard, there's a 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.
But the big news is a story that fell under the radar earlier this week. On Tuesday, Federal Reserve Vice Chair Stanley Fischer said negative interest rates "seem to work" in a Bloomberg interview. The central banker appeared to advocate for a policy that forces people to pay banks for the right to store their money in a vault. However, he didn't offer too many specific on why he believed such a punishment is good for anyone, even the banks. Here's the truth about negative interest rates, what it means for your money, and the future for the stock market.
Stocks to Watch Today, Sept. 2, 2016
- In earnings news, shares of Lululemon Athletica Inc. (Nasdaq: LULU) fell 8% in premarket hours after the company reported quarterly earnings. The firm topped profit expectations and reported revenue inline with Wall Street forecasts. However, the firm reduced its forward-looking guidance, fueling a selloff after the bell on Thursday.
- 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.
- The Christmas shopping season kicks off today. We're not kidding. Wal-Mart Stores Inc. (NYSE: WMT) will begin its holiday layaway program today. That's a full two weeks earlier than its 2015 program start. The firm says that it's attempting to get well out in front of competitors on the holiday shopping season.
- Shares of Apple Inc. (Nasdaq: AAPL) were gaining after CEO Tim Cook criticized 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. [Editor's Note: Here's why we are ranking AAPL stock a "Buy."]
Today'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.
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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.