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The Dow Jones today surged more than 350 points in pre-market trading after China's President Xi Jinping announced plans to "open" the nation's economy to foreign imports and regulation. The plan included goals of lowering import tariffs on automobiles, cracking down on intellectual property violations, and lowering other duties on imports. Mr. Xi's announcement is a significant shift from the previously aggressive trade war rhetoric used by the Chinese government, suggesting that a breakthrough may be at hand.
With markets staging a possible rebound, now is a great time to adjust your portfolio by buying those most sought-after stocks at bargain prices. Money Morning Director of Technology & Venture Capital Research Michael Robinson sees huge profit potential in the tech sector – the giants of Silicon Valley are "on sale." Take a look at Michael's strategy and stock picks here…
Here are the numbers from Monday for the Dow, S&P 500, and Nasdaq:
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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 Top Stock Market Stories for Tuesday
- U.S. automotive stocks moved higher after China's announcement on lowering vehicle tariffs. Shares of Ford Motor Co. (NYSE: F), General Motors Co. (NYSE: GM), and Fiat Chrysler Automobiles NV (Nasdaq: FCAU) all rallied more than 2% in pre-market hours.
- Markets will be looking for answers in a major shakeup that occurred during the later part of the trading session on Monday. The FBI raided U.S. President Donald Trump's personal lawyer's office in Manhattan. According to NBC News, the FBI is seeking any evidence tied to a $130,000 payment made to porn star Stormy Daniels before the 2016 election. Trump called the raid an "attack on our country."
- Gold prices popped nearly $2.00 in pre-market hours to $1,342.00 per ounce. Investors remain cautious about ongoing geopolitical tensions around the globe. Even though the United States and China may be on the verge of a major trade breakthrough, geopolitical tensions remain high in the Middle East and in Russia. In fact, Money Morning Resource Specialist Peter Krauth argues that the current situation is playing out to create a massive profit opportunity for gold investors in the months ahead. See his latest gold price forecast right here.
Money Morning Insight of the Day
Money Morning Director of Technology & Venture Capital Research Michael A. Robinson has brought our readers some of the best ways to make money on technology stocks. But there's always been one company that he's largely avoided over his career… until now. You're not going to believe what U.S. tech firm Michael says will unleash a wave of profits on investors in the future. Find out here.
Four Stocks to Watch Today: FB, TSLA, JPM, WFC
- Facebook Inc. (Nasdaq: FB) CEO Mark Zuckerberg will appear before a joint hearing of the Senate Judiciary and Commerce committee. Congress is investigating the data scraping efforts of Cambridge Analytica, which have brought a significant amount of embarrassment to the social media giant. Congress will be asking questions about the firm's privacy practices in the wake of the policy that allowed Cambridge Analytica to obtain the personal information of roughly 87 million users.
- Shares of Tesla Inc. (Nasdaq: TSLA) made small gains after the announcement by China's president to cut import tariffs. But there was a second factor that provided investor enthusiasm this morning. The head of the National Transportation Safety Board said that he had a "constructive conversation" with Tesla CEO Elon Musk as the agency probes a recent fatal crash involving the firm's semi-autonomous vehicles.
- Markets are paying close attention to earnings reports this week. The first major test of earnings season will come later this week after several key U.S. banks report earnings. JPMorgan Chase & Co. (NYSE: JPM), Citigroup Inc. (NYSE: C), and Wells Fargo & Co. (NYSE: WFC) will all report earnings on Friday morning.
- Look for additional earnings reports from Jamba Inc. (Nasdaq: JMBA), MSC Industrial Direct Co. Inc. (NYSE: MSM), AZZ Inc. (NYSE: AZZ), and Healthcare Services Group Inc. (Nasdaq: HCSG).
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.