DJIA News: Dow Ticks Higher as Markets Prepare for Interest Rate Hike

Garrett Baldwin

Today's DJIA news will center on a critical announcement from the Federal Reserve. This afternoon, the FOMC meeting will determine if interest rates will rise for the second time in three months. According to CME Group's FedWatch, the markets project a 95% probability that the central bank will increase rates by 25 basis points.

On Tuesday, the Dow fell 44 points as airline stocks faced pressure due to blizzard conditions on the East Coast and markets weighed a decline in crude oil prices.

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Let's look at the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:

Dow Jones: 20,837.37; -44.11; -0.21%

S&P 500: 2,365.45; -8.02; -0.34%

Nasdaq: 5,856.82; -18.97; -0.32%

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 30-point gain as markets expect the third interest rate hike by the Federal Reserve in more than a decade. This afternoon, the Fed will release an announcement on its monetary policy decisions and Fed Chair Janet Yellen will hold a press conference.

The markets expect an increase in benchmark rates by 25 basis points. The Fed had hinted toward a rate hike last week after stronger economic data in job creation and inflation expectations bolstered confidence in the U.S. economy.

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Crude oil prices have bounced off a three-month lows this week thanks to a surprise drawdown in U.S. inventory levels and optimism about OPEC's production deal to cap excessive output. The American Petroleum Institute announced yesterday that domestic inventory levels decreased by 500,000 barrels. Markets will turn to the official inventory report from the Energy Information Administration later this morning.

Meanwhile, the International Energy Agency released a surprise support hinting that OPEC simply needs more time to reach its goals of cutting production by 1.8 million barrels per day (bpd). The global oil cartel has been working with non-member nations like Russia to reduce excessive output and support crude prices.

This morning, the WTI crude oil price today added 2.2%. Brent crude slid 2.0%.

But the big news comes from MSNBC…

Last night, MSNBC released information from President Donald Trump's 2005 tax returns. The story was hyped as a game changer before the release as the president was the first leader in decades to refuse to release his tax records during his campaign.

However, the 2005 return indicated that President Trump paid $38 million in taxes on income of $150 million. That works out to a tax rate of roughly 25%, a figure that is higher than the tax rate paid by Trump's predecessor (19%) and MSNBC as an organization (24%).

Stocks to Watch Today, Mar. 15, 2017:

• Executives at United Parcel Service Inc. (NYSE: UPS) received huge compensation packages last year, even though company fell well short of Wall Street performance expectations. This includes big misses on revenue growth and total shareholder returns. Money Morning looks deeper into the disconnect between executive pay and company performance and offers you a better stock to own if you are a UPS shareholder. Check it out, right here.
• Shares of Snap Inc. (NYSE: SNAP) are flat in premarket hours after the company received a stock rating of "underweight" from Cantor Fitzgerald. The investment firm initiated coverage with a negative rating on the social media company due to concerns about its valuation and the strength of its marketing model. The parent company of Snapchat has seen its stock price fall since its IPO and the challenges are already mounting for the organization.
• Shares of Valeant Pharmaceuticals International Inc. (NYSE: VRX) are still sliding this morning, a day after the stock slipped more than 10%. The Canadian drug maker is reeling after activist hedge fund manager Bill Ackman took a $3 billion loss and unloaded his stake in the firm. It has been an absolutely brutal stretch for the hedge fund manager, who once compared the debt-ridden giant to Berkshire Hathaway Inc. (NYSE: A). Ackman's original stake of $3.2 billion was worth just $221 million when he decided to sell.
• Keep an eye out for earnings reports from Oracle Corporation (Nasdaq: ORCL), Williams-Sonoma Inc. (NYSE: WSM), Guess? Inc. (NYSE: GES), Jabil Circuit Inc. (NYSE: JBL), Com Holdings (Nasdaq: ALRM), and Titan International (NYSE: TWI).

Today's U.S. Economic Calendar (all times EST)

• MBA Mortgage Applications at 7 a.m.
• Consumer Price Index at 8:30 a.m.
• Retail Sales at 8:30 a.m.
• Empire State Manufacturing Survey at 8:30 a.m.
• Business Inventories at 10 a.m.
• Housing Market Index at 10 a.m.
• EIA Petroleum Status Report at 10:30 a.m.
• FOMC Meeting Announcement at 2 p.m.
• FOMC Forecasts at 2 p.m.
• Fed Chair Press Conference at 2:30 p.m.
• Treasury International Capital at 4 p.m.

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Garrett Baldwin

About the Author

Browse Garrett's articles | View Garrett's research services

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.

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