DJIA futures were pushing higher as investors reignited the "Trump Trade" and placed increased optimism in the president's planned economic policies. President Trump has promised to introduce a "phenomenal" tax plan in the coming weeks. The S&P 500 is now up 8.3% since Trump won the election in November.
On the global front, it looks like Greece is on the verge of yet another bailout deal. On Saturday, Greek Prime Minister Alexis Tsipras demanded that international leaders avoid adding new austerity burdens on the nation. Tsipras' warning came the same day that European Commission President Jean-Claude Juncker warned that any bailout deal was still on "shaky ground" because the International Monetary Fund has not fully assessed the situation and stated what its role will be through the process.
This is just another reason why the European Union is on its way to collapse. Money Morning Global Credit Strategist Michael Lewitt offers his insight into the future of the European Union and concludes with a shocking prediction: The EU won't last another five years.
On Friday, the Dow Jones hit another record high as markets cheered statements by President Donald Trump on his plans to reform corporate taxes.
Let's look at the numbers from Friday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 20,269.37; +96.97; +0.48%
S&P 500: 2,316.10; +8.23; +0.36%
Nasdaq: 5,734.13; +18.95; +0.33%
Here's a look at today's most important market events and stocks, plus a look at Monday's economic calendar.
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected a 47-point gain at opening bell. The markets continue to push higher as traders prepare for another busy day of earnings reports.
Trending: Top 10 2017 IPOs to Watch
Automotive companies are in focus after the chief executives of 18 manufacturers sent a letter to President Trump and urged his administration to review Obama-era fuel efficiency rules. The letter specifically targets mandates set by the Obama administration on fuel efficiency for 2025. The CEOs warned that thousands of American jobs could be at risk should efficiency rules be raised to an average of 50 miles per gallon for vehicles manufactured between 2022 and 2025.
Signatories included executives at General Motors Co. (NYSE: GM), Ford Motor Co. (NYSE: F), Fiat Chrysler Automobiles NV (Nasdaq: FCAU), Toyota Motor Corp. (NYSE: TM), Volkswagen AG (OTCMKTS: VLKAY), and Honda Motor Co. (NYSE: HMC).
The U.S. Federal Reserve is back in focus after the central bank's Vice Chair Stanley Fischer spoke over the weekend. In a speech at the Warwick Economics Summit, Fischer warned about significant uncertainty under the Trump administration. Fischer said that the central bank remains committed to its goals of full employment and its target rate of 2% inflation; however, he said he wasn't clear about the president's efforts to repeal the Dodd-Frank Act or if there would be changes to the amount of capital that banks will be required to hold in the future.
Crude oil prices were sliding as markets focus on rising production in the United States and temporarily ignore OPEC members' efforts to comply with a massive deal to cap excessive global production. Last week, the International Energy Agency announced that OPEC countries were 90% compliant in their cuts in January. That is far greater than the 60% compliance level from its 2009 production deal.
Improving optimism about OPEC's future goals offset worries that U.S. production continues to swell. On Friday, Baker Hughes Inc. (NYSE: BHI) announced that the official U.S. rig count increased by eight oil platforms. With 591 rigs in operation, the United States has not seen this much oil production activity since October 2015.
The WTI crude oil price today fell 0.7%. Brent crude dipped 0.7%.
But the big story is President Trump's battle against the retail sector.
Last week, President Trump lashed out at Nordstrom Inc. (NYSE: JWN) after the retailer announced it was dropping Ivanka Trump's clothing line from its locations.
Now, more retail companies are joining and dropping products that carry the Trump name. Over the weekend, Sears Holdings Corp. (Nasdaq: SHLD) and its subsidiary Kmart announced that they will end online sales of 31 different items from the Trump Home collection. These items include furniture and lighting products.
Sears joins Neiman Marcus, Nordstrom, and Belk as an aggressive customer campaign has called for a total boycott on the Trump brand.
Stocks to Watch Today, Feb. 13, 2017
- Shares of Macy's Inc. (NYSE: M) are up 1.7% after Barron's issued a report over the weekend saying that the stock has 50% upside. The optimism is based on expectations that the retail giant will be able to find a suitor as it continues a turnaround effort to improve its online retail offerings and downsize physical operations. The company has already announced plans to close at least 100 stores and slash roughly 10,000 jobs. The total savings from this strategy is forecast to hit around $550 million each year.
- Barron's is also driving shares of Abbott Laboratories (NYSE: ABT) higher. The financial publication praised the company's $25 billion purchase of medical device manufacturer St. Jude Medical Inc. (NYSE: STJ). Barron's anticipates that ABT stock could climb at least 20% over the year. ABT stock gained 1.1% in pre-market hours.
- Keep an eye out for additional earnings reports from Teva Pharmaceutical Industries Ltd. (Nasdaq ADR: TEVA), Flower Foods Inc. (NYSE: FLO), Rent-A-Center (Nasdaq: RCII), Snyder's-Lance Inc. (Nasdaq: LNCE), and Cornerstone OnDemand (Nasdaq: CSOD).
Today's U.S. Economic Calendar (all times EST)
- Four-Week Bill Announcement at 11 a.m.
- Three-Month Bill Auction at 11:30 a.m.
- Six-Month Bill Auction at 11:30 a.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.