The stock market news today will be dominated by the second FOMC meeting of 2017. The Dow is flat in pre-market hours as investors wait for the meeting to get underway. The markets largely anticipate the central bank will raise interest rates for the first time since December. A rate hike would be the third increase in a decade. However, it would symbolize that the central bank largely anticipates the U.S. economy is finally gaining traction after years of academic experimentation and loose monetary policy.
On Monday, the Dow fell 21.50 points as markets continue to take a wait-and-see approach to the U.S. Federal Reserve's plans for an interest rate hike.
Let's look at the numbers from Monday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 20,881.48; -21.50; -0.10%
S&P 500: 2,373.47; +0.87; +0.04%
Nasdaq: 5,875.78; +14.06; +0.24%
Here's a look at today's most important market events and stocks, plus a look at Tuesday's economic calendar.
What's Ahead for the Dow Jones Industrial Average Today
The Dow Jones Industrial Average projects a decline today, as Dow futures are down 61 points in pre-market hours as investors weigh weakening energy prices, a potential interest rate hike Wednesday, and the drawdown of earnings season. With the Federal Reserve set to meet March 14-15, CME FedWatch projects a roughly 93% chance that the central bank will raise interest rates.
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Investors will also be paying attention to a meeting by trade representatives from 12 nations that negotiated the Trans-Pacific Partnership (TPP) along with China and South Korea. The countries will gather for the first time since President Donald Trump pulled the United States out of the trade deal.
Geopolitical tensions continue to rise as markets eye North Korea's threats to attack U.S. interests. But the bigger battle today appears to be the harsh rhetoric between the Philippines and China over the South China Sea. Philippine President Rodrigo Duterte dispatched his navy Monday to assert Philippine ownership of a large ocean region off the country's northeastern coast. Here's why this is a huge deal to the global markets.
Crude oil prices hit a three-month low in pre-market hours as traders continue to raise concerns about increasing inventory levels in the United States and the sustainability of a deal by OPEC members to reduce excessive production.
This morning, the WTI crude oil price today dipped 0.1%. Brent crude slid 0.1%. Investors will be looking forward to another round of inventory data from the American Petroleum Institute this afternoon. Tomorrow, the Energy Information Administration will release its weekly report on domestic crude stocks.
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But the big news comes from activist hedge fund manager Bill Ackman.
On Monday, Pershing Square Capital founder Bill Ackman sold off his entire stake in the embattled Canadian drug company Valeant Pharmaceuticals International Inc. (NYSE: VRX). Shares of VRX fell more than 9% in after-hours trading yesterday after Ackman took a $3 billion loss and unloaded his stake. It has been an absolutely brutal stretch for the hedge fund manager, who once compared the debt-ridden giant to Berkshire Hathaway Inc. (NYSE: BRK.A). Ackman's original stake of $3.2 billion was worth just $221 million when he decided to sell.
Of course, Money Morning recommended investors use puts to short the stock when it was well above $200 per share. With the stock sitting just above $10.00 per share, the shares could continue to plunge.
Stocks to Watch Today, March 14, 2017
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- The IPO market has been quiet in March, outside of Snap Inc. (NYSE: SNAP), with only five companies going public. Investors need to know more about the four IPOs to watch for the week of March 13. Read about them here, right now.
- Markets are still in a frenzy over Mobileye NV (NYSE: MBLY). On Monday, shares of the semiconductor giant surged more than 28% on news that it sold itself to Intel Corp. (NYSE: INTC). The deal is worth roughly $15.3 billion and will give Intel a massive leg up in the emerging field of driverless technology. Shares were still ticking higher in pre-market hours.
- Keep an eye out for earnings reports from DSW Inc. (NYSE: DSW), the Rubicon Project Inc. (Nasdaq: RUBI), EnerNOC Inc. (Nasdaq: ENOC), HD Supply Holdings Inc. (NYSE: HDS), YY Inc. (NYSE: YY), Celldex Therapeutics (Nasdaq: CLDX), and Fogo de Chao (Nasdaq: FOGO).
Today's U.S. Economic Calendar (all times EDT)
- NFIB Small Business Optimism Index at 6 a.m.
- PPI-Final Demand at 8:30 a.m.
- Redbook at 8:55 a.m.
- Four-Week Bill Auction at 11:30 a.m.
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.