The Dow Jones Industrial Average fell on Monday as investors fretted over the stability of financial firms in the wake of Deutsche Bank's (NYSE: DB) ongoing balance-sheet challenges and Wells Fargo's (NYSE: WFC) public-relations nightmare.
DB stock slumped more than 2% after the U.S. government announced a $5.4 billion fine for misleading customers over mortgage-backed securities. The CBOE Volatility Index (VIX) - also known as the market's fear gauge - jumped more than 4%.
We expect volatility to heat up in October. That's why our list for the best stocks to buy in October 2016 emphasizes quality companies that can survive a volatile market. Before we get started on today's news, check out the three best stocks to buy in October, right here.
Let's look at the final numbers on Monday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 18,253.78; -54.37; -0.30%
S&P 500: 2,161.20; -7.07; -0.33%
Nasdaq: 5,300.87; -11.13; -0.21%
If you want to be a smart investor, you need to know what stocks to own. But you also need to know what stocks to avoid. Money Morning has put together a list of stocks on death watch in 2016. This is a list of stocks you must avoid, starting now.
Now, here's a look at today's most important market events and stocks, plus a preview of Tuesday's economic calendar.
DJIA Today: Stocks Slump as Investors Eye DB, Wells Fargo Fallout
It was a weak start to the fourth quarter for stocks on Monday. The Dow slipped 54 points after a slew of weak economic data and investors weighed new concerns about the financial sector. The September Markit Manufacturing PMI fell to a three-month low of 51.5.
Shares of Deutsche Bank fell nearly 2% after the company moved to reassure investors and clients that the German bank isn't facing a liquidity problem. JPMorgan Chase & Co. (NYSE: JPM) CEO Jamie Dimon moved today to reassure investors that the German bank has enough capital on hand and will not face liquidity problems. Last week, German Chancellor Angela Merkel said that her nation cannot afford to bail out the embattled firm. Here's what's next for DB stock and just how dangerous the situation has become for the global financial system.
Signs of a stock market crash are starting to pile up, increasing the likelihood of a pullback happening before the calendar flips to 2017. Five signals in particular are flashing a warning to investors to prepare for a stock market crash. Let's take a look at them, right here...
The markets were eyeing automotive stocks as companies reported September sales figures. Shares of General Motors Co. (NYSE: GM) added more than 1%, while rival Ford Motor Co. (NYSE: F) gained 0.2%. Ford announced that September sales fell more than 7% last month due to a sharp decline in fleet purchases. GM reported a 0.6% decline in September sales.
The big winner in the auto industry on Monday? Tesla Motors Inc. (Nasdaq: TSLA).
Shares of TSLA stock rallied nearly 5% after the firm announced that third-quarter deliveries surged by 70% to 24,500 cars. The firm also said it's on track to deliver at least 50,000 vehicles in the second half of 2016.
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Gold prices were falling on Monday after Britain announced a deadline to begin the process of exiting the European Union. British Prime Minister Theresa May's decision to set this deadline had very little influence on gold prices and other geopolitical hedges. Take a step back and you'll see that gold prices have been surging in 2016. Gold had its best first half to a year since 1980, and the yellow metal has rallied 25%. Where are gold prices heading next? Money Morning Resource Specialist Peter Krauth offers his insight, right here.
The price of crude oil today was shooting higher as traders continue to weigh the impact of OPEC's deal in Algeria. Crude prices pushed above $50 per barrel thanks to increased optimism over the deal and fading concerns about a global crude glut.
Money Morning Global Energy Strategist Dr. Kent Moors says that this deal isn't quite "there" just yet. Moors explains that OPEC nations must find a way to divide production among themselves and keep everyone happy. Then, there's one last challenge: getting Russia to take part in production limits. Here's what will happen next for oil prices.
The WTI crude oil price today gained 0.8%. Meanwhile, the Brent crude oil price gained 1.2%. Here's more on why crude oil prices were pushing higher on Monday.
Top Stock Market News Today, Oct. 3, 2016
- Want more proof that Facebook Inc. (Nasdaq: FB) stock is heading to $250 per share? Shares of FB stock ticked up 0.2% after the company launched a marketplace tab that boosts peer-to-peer shipping. The company launched the marketplace in the United States, United Kingdom, Australia, and New Zealand. Shares of eBay Inc. (Nasdaq: EBAY) fell 1.4% on competitive concerns. Here's more on where FB stock is heading in 2016.
- On the deal front, shares of Janus Capital Group Inc. (NYSE: JNS) gained more than 1.5% on news that the firm will merge with the Henderson Group, a British fund management firm.
- Meanwhile, shares of Cabelas Inc. (NYSE: CAB) gained more than 16% in pre-market hours on news that the hunting and fishing retail giant will be purchased by Bass Pro Shops. Analysts project the deal is worth $4.5 billion.
- On the earnings front, no major U.S. companies will release a quarterly report on Monday. Tomorrow, Alcoa Inc. (NYSE: AA) will unofficially kick off earnings season. Here's more on the other big events happening this week and where the markets go.
Tuesday's U.S. Economic Calendar (all times EDT)
- Richmond Fed President Jeffrey Lacker speaks at 8:05 a.m.
- Gallup US ECI at 8:30 a.m.
- Redbook at 8:55 a.m.
- 4-Week Bill Auction at 11:30 a.m.
- Chicago Federal Reserve President Charles Evans speaks at 8 p.m.
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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.