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This morning, the Dow Jones Industrial Average was plunging as investors continue to speculate on the timing of the next interest rate hike by the U.S. Federal Reserve.
Markets in Europe and Asia were also sliding as traders raised expectations that the central bank could raise interest rates as soon as this month.
With the Fed in focus, Money Morning Capital Wave Strategist Shah Gilani says that market volatility is on the verge of roaring back in September.
On Friday, the Dow fell 394 points as the markets increased the odds of a rate hike in September. According to CME FedWatch, the probability of a rate hike on Friday increased from 18% to 24%.
Friday's Stock Market Numbers:
Dow Jones: 18,085.45; -394.46; -2.13%
S&P 500: 2,127.81; -53.49; -2.45%
Nasdaq: 5,125.91; -133.57; -2.54%
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected a 71-point decline as investors continue to monitor the statements of Federal Reserve officials on the timing of the next rate hike. This morning, Federal Reserve Bank President Dennis Lockhart is speaking at the National Association for Business Economics about his view of the economy.
Oil prices were sliding again this morning as traders continue to worry about a glut in global supply. On Friday, the Baker Hughes Inc. (NYSE: BHI) rig count increased for the 10th straight week. The markets continue to weigh the possibility that OPEC and Russia could work to reduce global production in order to support crude prices. However, the odds of a deal are fading due to Saudi Arabia's political challenges.
This morning, the WTI crude price was off 1.9%, while Brent crude fell 1.8%.
Investors are keeping a close eye on silver prices. This morning, the silver spot price fell 2.3% as September interest rate hike talks have gathered momentum. Despite today's slip, we still see the silver spot price hitting $22 by the end of 2016.
But the big news this morning was in the intellectual property world. Shares of HP Inc. (NYSE: HPQ) were off nearly 1% after the firm announced plans to purchase the printer division of Samsung Electronics (OTCMKTS: SSNLF) for a little more than $1 billion.
Stocks to Watch Today, Sept. 12, 2016
- Shares of Tesla Motors Inc. (Nasdaq: TSLA) were flat on news that the firm is working to improve its Autopilot features. The National Highway Traffic Safety Administration has been investigating the crash of a semi-autonomous vehicle where a driver was killed. CEO Elon Musk says that Tesla has made a "massive enhancement" in its vehicle system and that it will be "making much more effective use of radar." Shares of TSLA stock were off a little more than 1% in pre-market hours.
- The Internet streaming war continues to heat up. The New York Times reports that both Amazon.com Inc. (Nasdaq: AMZN) and Pandora Media Inc. (NYSE: P) are about to introduce new streaming services within the next month. They could cost as little as $5 per month and could be a direct challenge to and problem for Apple Inc. (Nasdaq: AAPL).
- Look for earnings reports from TiVo Inc. (Nasdaq: TIVO), Triangle Petroleum Corp. (NYSE: TPLM), and Power Solutions International Inc. (Nasdaq: PSIX).
Today's U.S. Economic Calendar (all times EDT)
- Atlanta Federal Reserve Bank President Dennis Lockhart Speaks at 8 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.
- Minneapolis Federal Reserve Chair Neel Kashkari Speaks at 1 p.m.
- Federal Reserve Governor Lael Brainard Speaks at 1 p.m.
- 3-Year Note Auction at 1 p.m.
- 10-Year Note Auction at 1 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.