The Dow Jones Industrial Average is rising ahead of trading this morning, but all eyes will be on Federal Reserve Chair Janet Yellen as she speaks at the Fed's annual Jackson Hole summit today...
Dow futures are up 39 points this morning, and we don't expect the Fed will slow stocks down today. But investors will want to know how the Fed plans to unwind its $4.5 trillion balance sheet or if there will be another interest rate hike this year...
Here are the numbers from Thursday for the Dow, S&P 500, and Nasdaq:
On Friday, investors will again be seeking updates from the annual monetary policy symposium hosted by the Federal Reserve in Jackson Hole, Wyo. Today, Fed Chair Janet Yellen and European Central Bank President Mario Draghi will give separate speeches, and for Yellen, the stakes are high. This year's event could be her last should U.S. President Donald Trump not appoint her for another term at the helm of the central bank. Today, Yellen is expected to speak about the Fed's plan to unwind its massive balance sheet while managing expectations on inflation.
Amazon.com Inc. (Nasdaq: AMZN) is taking direct aim at the grocery industry. After its $13.7 billion deal to purchase Whole Foods Market Inc. (NYSE: WFM) closes this Monday, the firm will immediately begin slashing prices of organic goods and other select items. The firm will also offer discounts to members of its Prime subscription service. Anyone who said that there is such a thing as an "Amazon-proof" retail company is learning a hard lesson. In the U.S. retail industry, it's Amazon versus everyone, and the former is winning easily.
Markets faced pressure Thursday over threats by President Trump to shut down the U.S. government over his proposal to build a border wall. But that's not the biggest story in Washington this morning. President Trump's economic advisor Gary Cohn, who is being considered as the next chair of the Fed, said this morning that President Trump will push for tax reform next week. The statement came at the same time that Cohn said he had considered resigning in the wake of Trump's statement over the recent violence in Charlottesville, Va.
The potential for military conflict across the globe has investors pouring into safe-haven assets like gold. In fact, gold has outperformed the U.S. stock market so far in 2017. Concerns about a new surge in Afghanistan, the ongoing standoff in the Korean Peninsula, and instability along the Chinese and Indian border have helped support gold. Still, this morning gold prices were largely flat thanks to the Fed's Jackson Hole summit.
Crude oil prices and gasoline prices are on the move thanks to Hurricane Harvey. The category 3 hurricane made landfall on Thursday night and was the first of its size to hit the U.S. Gulf Coast in more than a decade. The Gulf of Mexico accounts for roughly one-sixth of U.S. crude production. The potential for the storm to slow oil production and disrupt transportation to refineries is pushing oil futures higher. WTI crude oil price today added 0.5%, while Brent crude 0.6%.
Four Stocks to Watch Today: SHLD, AAPL, BIG, GME
Shares of Sears Holdings Corp. (Nasdaq: SHLD) were up 2.5%, but not for reasons that one would consider positive. USA Today reported late Thursday that the embattled retailer will close another 28 Kmart locations as it attempts to keep its balance sheet in order through additional cost-cutting efforts. Sears has been one of the largest retailers to ignore the threat of Amazon, but it finally announced a partnership with the e-commerce giant to sell its Kenmore products online just last month.
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Apple Inc. (Nasdaq: AAPL) is in the news after CEO Tim Cook announced plans to invest roughly $1.3 billion into a data center located in Iowa. The company will produce roughly 50 jobs with its new facility, run completely on renewable energy, and provide distinct support to the company's App store. Of course, Apple - which has hundreds of billions of dollars sitting "offshore" - will receive about $200 million in tax incentives to bring the project to Iowa.
Shares of GameStop Corp. (NYSE: GME) plunged more than 8.6% on Friday after the company reported adjusted earnings per share (EPS) of $0.15. That missed analyst expectations by a penny. The downturn came despite news of an uptick in same-store sales, strong demand for the Nintendo Switch, and better-than-expected revenue. That said, the company is struggling against online competitors that allow digital downloads of games. Today, "Madden 18" will be released, which will be a test for the retailer's ability to compete against online outlets. The popular NFL franchise game has traditionally offered one of the strongest days of sales for GameStop, and a slow day will be a pessimistic sign for GME.
Friday features a very light calendar of earnings reports. Today, just Big Lots Inc. (NYSE: BIG) will report quarterly results before the bell. Wall Street expects that the retailer will report EPS of $0.62 on top of $1.215 billion in revenue.
Friday's U.S. Economic Calendar (all times EDT)
Durable Goods Orders at 8:30 a.m.
Federal Reserve Chair Janet Yellen speaks at 10 a.m.
Baker-Hughes Rig Count at 1 p.m.
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