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The Dow Jones today continues to move higher as optimistic investors cycle back into stocks amidst high volatility.
Dow futures were down as much as 284 points this morning, as European markets showed strong gains. European investors cheered a deal struck by Germany's Chancellor, Angela Merkel, to form a coalition government. This ends several months of uncertainty over the future of Europe's largest economy.
Sudden corrections can be scary and painful, and we understand that better than most. But here's why this recent sell-off is not cause for panic...
Here are the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
|Index||Previous Close||Point Change||Percentage Change|
Now here's a closer look at today's most important market events and stocks, plus Wednesday's economic calendar.
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The Five Top Stock Market Stories for Wednesday
- Choppy trading yesterday saw the Dow whipsaw 1,100 in different directions. This came a day after the Dow experienced a record loss of nearly 1,200 points, or 4.6%. Traders are trying to determine if this week's uncertainty is a short-term blip or part of a larger correction to the incredible market run since the election of U.S. President Donald Trump. Find Out What's Driving Market Volatility - and How to Triple Your Money on It
- Recent turbulence is tied directly to rising expectations that the U.S. Federal Reserve will need to accelerate interest rate hikes to combat an overheating economy. We'll be paying very close attention to statements today from three influential members of the Fed for clues on the timing of the central bank's next move. Dallas Fed Bank President Robert Kaplan, New York Fed President William Dudley, and Chicago Fed President Charles Evans will speak at different points of the day.
- Tesla Inc. (Nasdaq: TSLA) will headline a busy earnings day. Markets are really interested in learning the progress of Tesla's Model 3 production, which has faced lengthy delays and logistical bottlenecks. Given the company's huge amount of cash churn, Wall Street projects an adjusted earnings per share (EPS) loss of $3.15, according to FactSet. Analysts also project revenue of $3.29 billion for the quarter.
- Bitcoin surged more than 24% this morning. The rally of Bitcoin and other cryptocurrencies comes a day after the head of the CFTC told the Senate Banking Committee that he wants to properly regulate Blockchain technology and cryptocurrencies. Bitcoin had been in a free fall in recent weeks due to government crackdowns in China, India, and South Korea.
- On the commodities side, gold prices fell to a three-week low as investors monitor the strength of the U.S. dollar. An ounce of gold now runs at $1,326.60. Meanwhile, that stronger U.S. dollar is also weighing on solver, copper, platinum, and oil prices. Crude oil prices were mixed Wednesday morning. The WTI crude oil price today dipped 0.3%. Brent crude was unchanged.
Three Stocks to Watch Today: SNAP, DIS, WYNN
- Shares of SNAP Inc. (NYSE: SNAP) surged more than 20% after the bell on Wednesday, pushing the embattled social media company and owner of Snapchat above its 2017 IPO price. Yesterday's earnings report offered investors who have held on for dear life a sliver of hope that the firm can compete with Facebook's (Nasdaq: FB) Instagram. The company reported the growth of active users for the first time as a public company. SNAP reported an EPS loss of -0.13, beating estimates by a penny. Its $285.7 billion in revenue easily topped Wall Street estimates of $251.5 billion.
- Shares of the Walt Disney Co. (NYSE: DIS) popped 2% this morning thanks to stronger-than-expected earnings results and news that the firm has priced its upcoming ESPN streaming service. The firm reported EPS of $1.89, topping Wall Street's earnings estimate of $1.61 by a wide margin. Still, revenue fell slightly short of expectations. In addition to stating that its new streaming service, "ESPN Plus," would be $4.99 per month, the firm also stated that the pre-sale of tickets to the new film "Black Panther" is outpacing early ticket sales of any action film ever made.
- Shares of Wynn Resorts Ltd. (Nasdaq: WYNN) popped more than 9.3% after the hospitality giant's CEO and founder Steve Wynn stepped down. His resignation comes weeks after a Wall Street Journal reported detailed several allegations of sexual misconduct. Wynn, who denied the accusations, faced significant pressure to step down by investors, who watched these allegations rock the company's stock for weeks.
- Look for additional earnings reports from Yelp Inc. (Nasdaq: YELP), Michael Kors Holdings Ltd. (NYSE: KORS), Zynga Inc. (Nasdaq: ZNGA), Hasbro Inc. (NYSE: HAS), and iRobot Corp. (Nasdaq: IRBT).
Wednesday's U.S. Economic Calendar (all times EST)
- MBA Mortgage Applications at 7 a.m.
- New York Federal Reserve Bank President William Dudley speaks at 8:30 a.m.
- EIA Petroleum Status Report at 10:30 a.m.
- Chicago Fed Bank President Charles Evans Speaks at 11:15 a.m.
- 10-Year Note Auction at 1 p.m.
- Consumer Credit at 3 p.m.
- San Francisco Fed Bank President John Williams speaks at 5:20 p.m.
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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.