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The Dow Jones news today features investors anticipating the next interest rate hike and preparing for a slew of economic data during the second half of the week.
This morning, Automatic Data Processing surprised the markets by reporting the U.S. economy added nearly 298,000 private sector jobs in February, a figure that crushed economists' expectations. The consensus forecast for last month's report was just 190,000 jobs. The figure is considered a proxy for what the U.S. Labor Department will announce on Friday when it releases the official February employment report.
On Tuesday, the Dow dropped 29 points. Once again, President Trump's Twitter Inc. (NYSE: TWTR) feed was the catalyst of yet another downturn. This time, the POTUS hammered drug companies over high prices. President Trump said he is looking for new ways to boost competition and reduce the cost of medications.
Let's look at the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 20,924.76; -29.58; -0.14%
S&P 500: 2,368.38; -6.93; -0.29%
Nasdaq: 5,833.93; -15.25; -0.26%
Here's a look at today's most important market events and stocks, plus a look at Wednesday's economic calendar.
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projected a slight gain Wednesday. Dow Jones futures are trading up about 13 points this morning.
A strong private-sector employment report is likely to heighten expectations of an interest rate hike during the Federal Reserve's monetary policy meeting next week. Last Friday, Fed Chair Janet Yellen hinted that the central bank was set to raise rates should economic data continue to show positive momentum. With inflation levels rising toward the central bank's target and the first sign that February employment shattered expectations, expect a lot of chatter about a rate hike.
But the important question is now "How raising interest rates affects your money?" Money Morning breaks down that question and dives deeper into the impact on your credit, loans, and savings. Be sure to read our March Interest Rate Guide, right here.
Crude oil prices were were off as investors continue to weigh the stability of OPEC's January deal to curb excess production and new data suggests an even bigger inventory rise in the United States. On Tuesday, Saudi Oil Minister Khalid Al-Falih suggested that the primary reason why OPEC has been able to fulfill its obligations to cut excessive supply is due to his nation's willingness to surpass its goals and drop production below 10 million barrels per day (bpd). That statement has some questioning whether the deal is sustainable and if Saudi Arabia may seek changes to or abandon the plan in May.
Meanwhile, the American Petroleum Institute announced yesterday that U.S. crude inventory levels added 11.6 million barrels last week. Later this afternoon, the Energy Information Administration will report its weekly inventory report. Markets anticipate a build of almost 12 million barrels to add to the nation's existing record supply build.
The WTI crude oil price today dipped 1.0%. Brent crude slid 1.1%.
But the story sliding under the radar this morning is RadioShack.
The iconic electronics retailer that dominated the 1980s is expected to yet again file for Chapter 11 bankruptcy protection. The first time happened in February 2015 when it sold 2,400 stores to hedge fund Standard General. The hedge fund still believes that the company will be able to turn a profit and restructure. But the fund fails to understand a much bigger trend that is set to pummel brick-and-mortar retail companies like Radioshack now and in the future.
Money Morning Capital Wave Strategist Shah Gilani is highly recommending one retail stock... even though we are in a supposed "retail ice age." On a recent appearance at
"Varney & Co.," Shah shared the one retail position that he believes is a buy now... Read it, right here.
Stocks to Watch Today, March 8, 2017:
- Shares of Snap Inc. (NYSE: SNAP) were up slightly in pre-market hours. But the social media giant is already feeling the pain just days after going public. Tuesday, the stock fell another 8% and remained below its opening price after the Snapchat IPO. The social media company is under pressure after a major advocacy group representing institutional investors asked to bar companies that fail to provide voting rights to shareholders on the open market from their stock benchmarks. While investors may be eyeing the stock, Money Morning has discovered another way to profit from Snapchat without ever having to own shares. Here's our latest profit opportunity on SNAP stock.
- Shares of Caterpillar Inc. (NYSE: CAT) fell more than 2% in pre-market hours after the U.S. government accused the heavy equipment maker of fraud. This morning, The New York Times reported that the firm has used improper accounting tricks to help bolster the value of its stock. Check back to Money Morning later today for more on this breaking story.
- Keep an eye out for earnings reports from Ciena Corp. (Nasdaq: CIEN), United National Foods (Nasdaq: UNFI), Tailored Brands (Nasdaq: TLRD), Express Inc. (Nasdaq: EXPR), Vera Bradley (NYSE: VRA), and Orbital ATK (NYSE: OA).
Today's U.S. Economic Calendar (all times EST)
- ADP Employment Report at 8:15 a.m.
- Productivity and Costs at 8:30 a.m.
- Wholesale Trade at 10:00 a.m.
- 10-Year Note Auction at 1:00 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.