The Dow Jones Industrial Average fell as much as 120 points in Tuesday's pre-market trading as markets struggled to identify new catalysts to rally major indexes. The Dow has yet to lock in any significant gains this month, falling over 180 points since Sept. 1.
According to hedge fund manager Ray Dalio, we are in the seventh inning of our existing economic cycle, and investors should be more defensive given the downside risks to stocks right now. And he's not the only one...
Here are the numbers from Monday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
25,857.07
-59.47
-0.23%
S&P 500
7,924.16
21.62
0.27%
Nasdaq
2,877.13
5.45
0.19%
Now here's a closer look at today's Money Morning insight, the most important market events, and stocks to watch.
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The Top Stock Market Stories for Tuesday
Global markets are under pressure this morning as investors continued to worry about the ongoing trade war between the United States and China. The Hong Kong stock market fell into bear territory this morning as more and more investors from China are unable to push additional capital into their investments. Investing abroad has grown more expensive as the Chinese yuan continues to depreciate against the Hong Kong dollar, which is pegged to the U.S. dollar. The Hang Seng index is 20% lower than its January 2018 peak.
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U.S. investors will be keeping a close eye on Hurricane Florence, which is breaking down on the East Coast. The hurricane is expected to be one of the worst to make landfall in the Carolina region in more than 60 years. The last Category 4 storm to hit North Carolina was Hurricane Hazel in 1954.
The CME Group's FedWatch tool for a September rate hike says that the odds are sitting at a 99.8% probability. That makes headwinds for the price of gold. But Money Morning Resource Specialist Peter Krauth predicts that a breakout is coming for the yellow metal. Here's what you need to know about gold prices to start your Tuesday morning.
Money Morning Insight of the Day
3 Ways to Profit Right Now
There's Still Time to Get In Early on This Company Before It Makes a Major Announcement
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Three Stocks to Watch Today: IDTI, TSLA, NKE
Shares of Integrated Device Technology Inc. (Nasdaq: IDTI) jumped more than 11.5% after the American chipmaker said it will be sold to Renesas Electronics Corp. of Japan. Renesas will spend $6.7 billion in a deal that the company says will improve its market share in the automotive industry.
Shares of Tesla Inc. (Nasdaq: TSLA) were off 1.9% after the company announced changes to its vehicle color offerings. CEO Elon Musk said that the company will reduce the number of color options from seven to five in order to "simplify manufacturing." The company has struggled to increase its Model 3 production to ensure profitability. Recently, a number of high-ranking executives departed the company for undisclosed reasons. An analyst at Nomura this morning said that the stock is no longer investable and said that "notwithstanding improving fundamentals, we believe that Tesla is in need of better leadership."
Shares of Nike Inc. (NYSE: NKE) jumped more than 0.6% after the stock received an upgrade from analysts at Canaccord Genuity. The analyst issued a "Buy" rating and hiked his price target from $78 to $95. At the center of the report was the company's latest advertising campaign featuring former San Francisco 49ers quarterback Colin Kaepernick. The analyst dubbed the advertisement "a stroke of genius."
Look for additional earnings reports from Francesca Holdings Corp. (Nasdaq: FRAN), Farmer Brothers Corp. (Nasdaq: FARM), and USA Technologies Inc. (Nasdaq: USAT).
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.