The Dow Jones Industrial Average kicked off November with an 87-point gain pre-market trading. Equity markets continue to recover slowly from an October swoon that punished investors over concerns related to rising interest rates, geopolitical tensions between the U.S. and China, and softer-than-expected corporate earnings.
Today, investors will eye another busy day of earnings reports highlighted by a report after the bell by Apple Inc. (NASDAQ: AAPL). As we prepare for November's market performance, we're looking back at what made October so volatile - and how we might not be out of the woods yet...
Here are the numbers from Wednesday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
25,115.76
241.12
0.97%
S&P 500
2,711.74
29.11
1.09%
Nasdaq
7,305.90
144.25
2.01%
Now, here's a closer look at today's Money Morning insight, the most important market events, and stocks to watch.
The Top Stock Market Stories for Thursday
Apple Inc. (NASDAQ: AAPL) will report earnings after the bell Thursday, and Wall Street is expecting big things from the technology giant. Analysts anticipate that the firm will report earnings per share of $2.79 on top of $61.49 billion in revenue. The numbers are expected to be supported by stronger demand for its more expensive iPhones. AAPL stock is up nearly 30% year-to-date.
While earnings season remains in full swing, ongoing Brexit negotiations are working to prevent a hard departure by the United Kingdom from Europe. It appears that Britain is on the verge of reaching an agreement with the EU to provide access to UK firms access to Europe's single market. Bank shares like BarclaysPlc. (NYSE: BCS) and Royal Bank of Scotland Group (NYSE: RBS) pressed higher on the news. Those gains came despite news elsewhere that the Bank of England had cut its growth and inflation expectations for the British economy.
With the 2018 midterm elections in focus, markets are placing their bets on whether Republicans or Democrats will hold control of Congress after next Tuesday. But this is the wrong issue to focus on. The real opportunity comes with the news that several states will hold votes on whether to legalize medical or recreational marijuana. And one state is about to turn into a $2 billion market overnight. Money Morning's Michael Robinson details legalization plans in Michigan – and how you can make a fortune by next Tuesday.
Money Morning Insight of the Day
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Alphabet Inc. (NASDAQ: GOOGL) is facing public relations problems today after hundreds of employees around the globe began walking out in protest over how the firm handles the increasing problem of sexual harassment within its ranks. The "Google Walkout" began in Asia and Europe this morning after an investigation detailed years of sexual harassment cases, large severance packages for accused perpetrators, and little transparency into the process and results of these investigations. The company's CEO Sundar Pichai has issued his support for the company protest.
In deal news, shares of Newfield Exploration Co. (NYSE: NFX) popped more than 13% on news the company has been sold for $4.2 billion to Canadian oil and gas producer Encana Corp. (NYSE: ECA). The all-stock deal is a precursor to Encana's plan to buy back shares of its own stock when this deal closes. Encana is also set to hike its dividend by 25%. However, shares of Encana were off 15% this morning after the news.
The other key earnings report today will come from Starbucks Corp. (NASDAQ: SBUX). The iconic coffee chain is still mired in controversy over racial sensitivity and its same-store sales have remained weak. Investors will look to hear more about the company's new turnaround strategy under newly hired CEO Kevin Johnson.
Look for earnings reports from GoPro Inc. (NASDAQ: GPRO), Pandora Media Inc. (NYSE: P), United States Steel Corp. (NYSE: X), Wynn Resorts Ltd. (Nasdaq: WYNN), CBS Corp. (NYSE: CBS), Shake Shack Inc. (NYSE: SHAK), and Kraft Heinz Co. (NYSE: KHC).
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.