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The Dow Jones Industrial Average today is now in striking distance of 20,000 after President-elect Donald Trump's press conference.
Trump took broad swipes at the pharmaceutical, automotive, and defense industries over outsourcing and government costs.
Biotech stocks dropped after the press conference. Trump said that drug companies are "getting away with murder" with what they are charging the U.S. government for medications.
Following Trump's statement, shares of iShares Nasdaq Biotech ETF (Nasdaq: IBB) plunged more than 2.5%. Shares of Pfizer Inc. (NYSE: PFE) and Gilead Sciences Inc. (Nasdaq: GILD) both fell more than 1.5%.
President-elect Trump said that he will force drug companies to take part in a competitive bidding process.
But investors remain optimistic that President-elect Trump's proposed economic policies will help bolster corporate revenue and economic growth.
Let's look at the numbers from Wednesday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 19,954.28; +98.75; +0.50%
S&P 500: 2,275.32; +6.42.; +0.28%
Nasdaq: 5,563.65; +11.83; +0.21%
Now, here's a look at today's most important market events and stocks, plus a preview of Thursday's economic calendar.
DJIA Today: Dow Rallies Back Within Striking Distance of 20,000
Investors continue to take wait-and-see approach as earnings season enters full swing. The frenzy really kicks off Friday with quarterly reports coming from Bank of America Corp. (NYSE: BAC), BlackRock Inc. (NYSE: BLK), and JPMorgan Chase & Co. (NYSE: JPM).
It was a good day for airline stocks. The U.S. Justice Department announced it was not bringing legal action against airline carriers. Roughly two years ago, the federal agency announced it was investigating claims that airline companies had colluded on flight capacity in order to drive up fares. Shares of Delta Airlines Inc. (NYSE: DAL), American Airlines Group Inc. (Nasdaq: AAL), United Continental Holdings Inc. (NYSE: UAL), and Southwest Airlines Co. (NYSE: LUV) all had modest gains on the day.
Crude oil prices were bouncing off a one-month low on news that Saudi Arabia has followed through and begun cutting excessive production. The uptick came despite news that U.S. inventory levels rose more than analysts expected last week. The U.S. Energy Information Administration announced that crude stocks increased by 4.1 million barrels last week. That surpassed industry expectations.
The WTI crude oil price today climbed over 2%. Meanwhile, Brent crude was up 2.7%.
While everyone is talking about Trump's statement on pharmaceutical companies, the real news today is happening south of the U.S. border. On Wednesday, the Mexican peso hit an all-time low against the U.S. dollar after Trump warned auto companies that they would face steep import taxes should they continue to produce vehicles in Mexico. Trump also reiterated his plans to build a wall along the border to stop the flow of undocumented immigrants heading into the country.
So, what does this story mean for investors? It's another important indicator that Trump is emphasizing an "America First" strategy to manufacturing. With the auto sector in focus, Money Morning Executive Editor Bill Patalon recently outlined his favorite manufacturing play for 2017 and beyond. Patalon has a remarkable track record thanks to his understanding of capital flows and international politics. To see his latest pick, watch this short video.
Stock Market News and Top Stocks to Watch Today: Jan. 11, 2016
- It wasn't just the pharmaceutical and auto industry that took shots from President-elect Trump Wednesday. Trump also called out defense contractor Lockheed Martin Corp. (NYSE: LMT). Shares of LMT stock fell more than 1% after Trump said the F-35 fighter jet program "is way behind schedule and billions over budget."
- In a deal that shakes up the global logistics market, FedEx Corp. (NYSE: FDX) announced it has signed a multiyear contract with drug chain Walgreens Boots Alliance Inc. (NYSE: WBA). The deal will allow customers to pick up deliveries at roughly 8,000 Walgreens locations around the country. By late 2018, the deal will allow users to drop off and pick up pre-packaged and pre-labeled deliveries. Shares of FDX added 0.3%, while WBA stock added 2%.
- Finally, if you're looking to make real money in 2017, you should start by tapping into the big growth potential of the U.S defense sector. With President-elect Trump poised to take office, investors anticipate the government will spend a lot of money bolstering the U.S. military. That's why we recommend that you learn about the three top military defense stocks for 2017. These are the best stocks to own in the defense sector.
Thursday's U.S. Economic Calendar (all times EST)
- Philadelphia Federal Reserve Bank President Patrick Harker speaks at 8:30 a.m.
- Chicago Federal Reserve Bank President Charles Evans Speaks at 8:30 a.m.
- Import and Export Prices at 8:30 a.m.
- Bloomberg Consumer Comfort Index at 9:45 a.m.
- EIA Natural Gas Report at 10:30 a.m.
- Three-Month Bill Announcement at 11 a.m.
- Six-Month Bill Announcement at 11 a.m.
- 10-Year TIPS Announcement at 11 a.m.
- Atlanta Federal Reserve Bank President Dennis Lockhart speaks at 12:30 p.m.
- 30-Year Bond Auction at 1 p.m.
- Louis Federal Reserve Bank President James Bullard speaks at 1:15 p.m.
- Treasury Budget at 2 p.m.
- Fed Balance Sheet at 4:30 p.m.
- Money Supply at 4:30 p.m.
- Federal Reserve Bank President Janet Yellen speaks at 7 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.