The Dow Jones today plunges further as concerns about rising interest rates and inflation increase.
Dow futures were down as much as 257 points this morning as Asian markets sold off. Strong jobs data and an uptick in worker wages have many concerned the value of the dollar will slide.
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Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
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The Five Top Stock Market Stories for Monday
U.S. markets slid again Monday morning due to concerns about rising interest rates and inflation. U.S. investors are seeing red after big drops in the Japanese Nikkei and European markets. Friday's strong jobs report and uptick in worker wages have many concerned that the value of the dollar will slide and that corporate profits will take a resulting hit. The uptick in interest rates is making bonds a more attractive investment.
The price of Bitcoin faced more pressure over the weekend. The downturn came on news that several major banks have banned the purchasing of Bitcoin with credit cards. Bank of America Corp. (NYSE: BAC), JPMorgan Chase & Co. (NYSE: JPM), and Citigroup Inc. (NYSE: C) have all banned cryptocurrency purchases since Friday. This means that the top five credit card issuers have now halted the practice. Bitcoin sat at $7,773 this morning.
Janet Yellen is officially out of the Federal Reserve and will be heading to the Brookings Institution. Today, Jerome Powell will begin his first term at the helm of the U.S. central bank. Powell takes over at an interesting time for the U.S. economy. The central bank is expected to raise interest rates three times in 2017. In addition, Powell must manage a $4.5 trillion balance sheet that the Fed built up in the wake of last decade's financial crisis.
Gold prices saw a slight gain in pre-market hours. But those gains could surge as markets continue to face questions about inflation and a weaker U.S. dollar. Gold prices saw one of their biggest one-day declines in two months on Friday. Investors are looking at this as a solid entry point given price expectations from Money Morning Resource Specialist Peter Krauth. Peter expects that gold prices will reach $1,400 by the end of June and rise to as high as $1,500 by December.
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Crude oil prices slid in pre-market hours to a one-month low. The WTI crude oil price today fell 0.6%. Brent crude dropped 1.1%. Markets are growing increasingly fearful that rising U.S. production could spur an oversupply of the markets.
Four Stocks to Watch Today: WFC, AVGO, QCOM, BMY
Shares of Wells Fargo & Co. (NYSE: WFC) are off more than 8% this morning because the Fed has forced new sanctions on the bank that will limit its growth. The Fed's consent order will see the bank change four members of its board of directors and limit its growth beyond $1.95 trillion in assets. The order comes as a result of a massive scandal that engulfed the firm after its employees opened millions of customer accounts without consent. The bank says the sanctions will reduce its 2018 profits by up to $400 million.
In deal news, Broadcom Ltd. (Nasdaq: AVGO) will increase its offer to $120 billion for Qualcomm Inc. (Nasdaq: QCOM). The offer is a significant improvement from the initial pitch, and it would be the largest technology deal ever.
In earnings news, shares of Bristol-Myers Squibb Co. (NYSE: BMY) popped 4.1%. The drug manufacturer reported earnings per share of $0.68, a figure that bested estimates by a penny. The firm also beat revenue expectations. BMY said that its cancer drug Opdivo has received approval for melanoma patients.
Look for earnings reports from Arconic Inc. (Nasdaq: ARNC), Skyworks Solutions Inc. (Nasdaq: SWKS), Cirrus Logic Inc. (Nasdaq: CRUS), Fortinet Inc. (Nasdaq: FTNT), National Oilwell Varco Inc. (NYSE: NOV), Sysco Corp. (NYSE: SYY), Hess Corp. (NYSE: HES), Booz Allen Hamilton (NYSE: BAH).
Monday's U.S. Economic Calendar (all times EST)
PMI Services Index at 9:45 a.m.
ISM Non-Manufacturing 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.
TD Ameritrade IMX at 12:30 a.m.
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