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This morning, the Dow Jones Industrial Average was pushing higher as investors weigh another round of economic data from the United States and China.
Investors are also reviewing a number of blue-chip companies that are reporting earnings, and traders are still speculating on the timing of the next interest rate hike.
Today, investors be weighing statements from three members of the Federal Reserve to determine the timing of the next rate hike. According to CME Group's FedWatch Tool, the probability of a rate hike in December sits just south of 70%.
On Tuesday, the Dow rallied 75 points as investors weighed positive earnings results. The S&P 500 and the Nasdaq had their best week in a month due to increased optimism on earnings expectations.
Tuesday's Stock Market Numbers:
Dow Jones: 18,161.94; 75.54; 0.42%
S&P 500: 2,139.60; 13.10; 0.62%
Nasdaq: 5,243.84; 44.01; 0.85%
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected an 11-point gain as investors eye more reports from Wall Street and the Federal Reserve releases its Beige Book filled with commentary on the economy.
In today's trading session, expect to hear quite a bit about China's economy. This morning, the country reported a slew of positive economic data that should improve investor sentiment on the health of the world's second-largest economy. In the third quarter, China's economy grew by 6.7%, a figure that met expectations. This is the second straight quarter that China reported 6.7% quarterly growth. The nation also reported strong retail sales. In September, Chinese retail figures increased by 10.7%.
But there's always one figure that spooks investors. The country reported that its industrial production figure came in at 6.1% for September. That number fell short of Wall Street estimates.
Shares of Morgan Stanley (NYSE: MS) gained more than 1.3% after the investment bank reported quarterly earnings in pre-market hours. The investment bank reported earnings per share (EPS) of $0.81, topping Wall Street earnings expectations of $0.63. The bank said it bolstered revenue thanks to a 61% increase in bond trading income.
It's been a positive week for financial stocks as investors cheer strong earnings reports and expectations rise for the Federal Reserve to increase interest rates in December. But while everyone is growing more optimistic, another big story is brewing that everyone seems to have ignored. There is a crisis in the consumer debt markets… and it all comes back to one terrible word from the 2009 financial crisis: subprime lending.
Oil prices were on the move ahead of today's inventory update by the Energy Information Administration. Crude prices rose after a positive OPEC statement bolstered trader enthusiasm and the American Petroleum Institute said that U.S. crude inventories fell by 3.8 million barrels last week. Saudi Arabian Energy Minister Khalid al-Falih said this morning that the markets were moving back toward a stronger supply and demand balance, news that should help alleviate the global glut that has driven down prices.
The WTI crude oil price today added 1.6%, while the Brent crude oil price gained 1.2%.
Stocks to Watch Today, Oct. 19, 2016
- In earnings news, shares of Yahoo! Inc. (Nasdaq: YHOO) gained 1.3% in pre-market hours after the firm topped earnings expectations after the bell on Tuesday. The company said after its earnings report that it is ready to merge its internet business with Verizon Communications Inc. (NYSE: VZ). With YHOO earnings in focus, here's everything you need to know and how to play the stock moving forward.
- Shares of Halliburton Co. (NYSE: HAL) gained nearly 1% in pre-market hours after the company announced a surprise profit in the third quarter. The oil field services provider reported EPS of $0.01, beating analyst expectations of an EPS loss of $0.06. The firm also topped revenue expectations.
- Look for additional earnings reports from eBay Inc. (Nasdaq: EBAY), American Express Co. (NYSE: AXP), Kinder Morgan Inc. (NYSE: KMI), Abbott Laboratories (NYSE: ABT), and Mattel Inc. (NYSE: MAT).
Today's U.S. Economic Calendar (all times EDT)
- MBA Mortgage Applications at 7 a.m.
- Housing Starts at 8:30 AM ET
- San Francisco Fed Bank President John Williams speaks at 8:45 a.m.
- Atlanta Fed Business Inflation Expectations at 10 a.m.
- EIA Petroleum Status Report at 10:30 a.m.
- Dallas Federal Reserve Bank President Rob Kaplan speaks at 1:30 p.m.
- Beige Book at 2 p.m.
- New York Federal Reserve Bank President William Dudley Speaks at 7:45 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.