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The Dow Jones Industrial Average was flat during the final trading day before the Christmas holiday. Many pundits expect Friday to feature light trading volumes and little volatility.
However, there could be a few surprises, as two important economic reports will be released later this morning.
On Thursday, the Dow slipped 23 points as consumer stocks dipped thanks to a round of lackluster earnings reports. The downturn occurred even though the U.S. Commerce Department reported that third-quarter GDP increased by 3.5% and that the number of Americans seeking unemployment benefits was hovering near a 43-year low.
Let's look at the numbers from Thursday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 19,918.88; -23.08; -0.12%
S&P 500: 2,260.96; -4.22; -0.19%
Nasdaq: 5,447.42; -24.01; -0.44%
Here's a look at today's most important market events and stocks, plus a look at Friday's economic calendar.
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected a four-point gain in pre-market hours.
First up, keep an eye on November home sales. A positive report will likely have a positive impact on construction firms like KB Home (NYSE: KBH), Lennar Corp. (NYSE: LEN), and Toll Brothers Inc. (NYSE: TOL). On Thursday, these companies all fell sharply.
Next up, the markets will be paying attention to the December consumer sentiment report. Since the election, consumer optimism has surged thanks to improving outlooks on the U.S. economy and job market. The monthly report is especially important to retailers who are looking for clues into the willingness of customers to spend money during the holiday shopping season. Keep an eye on big retailers like Macy's Inc. (NYSE: M) and JCPenney Co. Inc. (NYSE: JCP), which both saw a steep downturn in their stock on Thursday.
Crude oil prices were pushing lower on news that Libya has increased its production plans. The nation announced its intention to hike its crude output by roughly 270,000 barrels per day (bpd). Also weighing on crude prices was the news that U.S. inventory levels surprisingly increased last week, according to the Energy Information Administration's weekly report.
The WTI crude oil price today dipped 0.6%. Meanwhile, Brent crude slipped about 0.6%
Money Morning Global Energy Strategist Dr. Kent Moors argues that powerful forces are manipulating the global oil markets.
But the big news today is the announcement that President-elect Donald Trump has nominated Peter Navarro to head the White House National Trade Council.
Navarro is a professor of economics and public policy at the Paul Merage School of Business, University of California, Irvine. He is also an outspoken critic of China's trade policies and author of a book on the country's impact on the U.S. economy called "Death by China."
The decision is seen as an effort by Trump to double-down on the hard talk about China's currency devaluation, its growing trade balance against the United States, and its shaky trade relationship with the United States. Some are worried Trump's policies – which include proposals for tariffs on Chinese goods – could spark a trade war between the world's two largest economies.
Finally, check your calendar. On Monday, Dec. 26, the markets will be closed in observance of the Christmas holiday. Markets will reopen on Tuesday, Dec. 27, at regular market hours.
And speaking of calendars…
America's No. 1 Trader, Tom Gentile, is back with a look at what is happening with his Money Calendar Alert. Today, he's talking about two different patterns that can make you a lot of money if you just spend a few minutes a day learning how options trading works.
Stocks to Watch Today, Dec. 23, 2016
- Is it time to take away President-elect Donald Trump's account on Twitter Inc. (NYSE: TWTR)? On Thursday afternoon, shares of Uranium Resources Inc. (Nasdaq: URRE) rallied more than 30% in post-market hours after Trump sent out a message encouraging the United States to "greatly strengthen and expand its nuclear capability." That was eerily followed by a speech by Russian President Vladimir Putin, who said that Russia also needed to "strengthen the military potential of strategic nuclear forces." Both Russia and the United States have the largest nuclear stockpiles by a tremendous margin. Shares of Uranium Energy Corp. (NYSE: UEC) added 4%.
- Another European bank is under scrutiny for sales of toxic mortgage assets during the run up to the 2008 financial crisis. On Thursday, the U.S. Justice Department formally sued Barclays Plc. (NYSE ADR: BCS) and two executives, alleging that the organization deceived investors on the quality of loans from 2005 to 2007. Though major U.S. banks like Bank of America Corp. (NYSE: BAC) and JPMorgan Chase & Co. (NYSE: JPM) have already settled with the U.S. government on similar charges, the U.S. Justice Department has been delayed in negotiations with European banks. According to various reports, the government's legal arm is currently pursuing similar settlements with Deutsche Bank AG (USA) (NYSE: DB) and Credit Suisse Group Inc. (NYSE: CS).
- In earnings news, shares of Cintas Corp. (Nasdaq: CTAS) fell by 4% in pre-market hours after the company fell short of Wall Street earnings expectations. The company topped revenue projections but missed its $1.15 EPS estimate by $0.02. Meanwhile, share of Cal-Maine Foods Inc. (Nasdaq: CALM) added 1.3% this morning after the company matched Wall Street profit expectations but easily topped revenue estimates.
- No major U.S. companies report earnings on Friday.
Today's U.S. Economic Calendar (all times EST)
- New Home Sales at 10 a.m.
- Consumer Sentiment at 10 a.m.
- Baker Hughes Rig Count at 1 p.m.
- Bond Market Close: 2 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.