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In Dow Jones news today (Friday, May 12), markets slipped again thanks to slipping industrial stocks and continued weakness in retail stocks. The industrial sector slipped on news that Deutsche Bank AG (NYSE: DB) downgraded General Electric Co. (NYSE: GE) from "Hold" to "Sell" and raised concerns about the firm's dividend.
Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
|Index||Closing||Point Change||Percentage Change|
Now here's a closer look at today's most important market events and stocks, plus Monday's economic calendar.
The Five Top Stock Market Stories for Friday
- Global markets were optimistic on news that China and the United States have signed a 10-point trade deal. This blockbuster deal will open the Chinese market for U.S. credit card companies, credit rating agencies, and liquefied natural gas shipments. The deal also ends the ban on U.S. beef imports into the world's second-largest economy. In return, Chinese banks may enter the United States and export cooked chicken.
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- The "Retail Ice Age" reared its ugly head again Friday. Shares of Nordstrom Inc. (NYSE: JWN) and JCPenney Co. Inc. (NYSE: JCP) both fell sharply after the two retailers fell short of Wall Street revenue expectations and reported weak same-store sales. Meanwhile, the U.S. Commerce Department reported a 0.4% increase in retail sales in April, which was still below expectations of 0.6%. The downward trajectory for brick-and-mortar retailers continues as consumers shift to e-commerce channels and firms rely more on discounting to attract customers, a strategy that weighs on margins.
- The U.S. Federal Reserve was back in focus Friday as investors weighed comments from Chicago Fed President Charles Evans and his Philadelphia counterpart Patrick Harker, and markets weighed the April Consumer Price Index (CPI). Evans generated the most interest today after he said that while he supported two additional interest rate hikes in 2017, he believed there remained downside risks to inflation that could deter such a vote. Following the release of soft retail sales data and the CPI, the odds of an interest rate hike fell from 54% to 49%, according to CME's FedWatch Tool.
- The gold price today finished higher and marked the third straight day of gains for investors. With the price hovering north of $1,225 per ounce, gold has bounced back strongly in recent weeks to provide its longest winning streak since mid-April. Money Morning Resource Specialist Peter Krauth explains that last Sunday's presidential election in France has played an important role in bolstering bullish sentiment in the yellow metal. Here's Peter's latest insight and price forecast for gold in 2017.
- The WTI crude oil price todaywas flat, while Brent crude gained 0.1%. Markets are hoping that OPEC members will extend a deal to reduce supply and help bolster crude oil prices. The global oil cartel will meet in Vienna, Austria, on May 25 to discuss an extension to its six-month deal to cap excessive production, a deal which has struggled to produce results due to rising U.S. shale production.
Five Stocks to Watch Friday: AMZN, S, TMUS, TDW, GE
- Shares of Amazon.com Inc. (Nasdaq: AMZN) added 1.5% after the company received a shot of confidence from billionaire tech investor Mark Cuban, who called the e-commerce giant the "ultimate startup." As it continues to pummel brick-and-mortar retailers, the firm has announced plans to bolster its attention to the online furniture industry, news that should worry investors of Wayfair Inc. (NYSE: W) and Williams-Sonoma Inc. (NYSE: WSM)
- In deal news, it appears that merger activity is about to heat up in the wireless industry. Shares of both Sprint Corp. (NYSE: S) and T-Mobile US Inc. (Nasdaq: TMUS) ticked higher on news that the third- and fourth-largest wireless carriers are discussing a merger. The government had prevented the two from engaging in merger talks for roughly a year
- Shares of Tidewater Inc. (NYSE: TDW) plunged more than 43% today on rising expectations that the oil services firm will file for bankruptcy next week. The bankruptcy deal will wipe out $1.6 billion in debt. The oil services company has struggled significantly over the last few years due to the downturn in global oil prices. The company plans to remain a publicly traded company; however, it must trade above $1 per share by Oct. 18 to avoid delisting from the New York Stock Exchange.
- The other top stocks to watch today included General Electric Co. (NYSE: GE). Shares of the industrial giant fell by more than 2.5% after receiving a downgrade from German financial giant Deutsche Bank AG (NYSE: DB). The firm received the downgrade over concerns that General Electric's cash flow is facing significant risks, which could force it to slash its dividend as soon as 2018.
Monday's U.S. Economic Calendar (all times EDT)
- Empire State Manufacturing Survey at 8:30 a.m.
- Housing Market Index at 10 a.m.
- 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.
- Treasury International Capital at 4 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.