The Dow Jones Industrial Average fell 285 points Thursday morning after Apple Inc. (NASDAQ: AAPL) slashed its guidance for the current quarter. The firm said it expects quarterly revenue to come in at $84 billion, well below the previous range of $89 billion to $93 billion. The figure also badly misses the average Wall Street estimate of $91.5 billion in revenue.
Following the news, Apple shares fell over 7%, knocking $55 billion off Apple's market capitalization. There's more bad news though. Goldman Sachs Group Inc. (NYSE: GS) said this morning that Apple will likely need to cut its guidance even further.
Here are the numbers from Wednesday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
23,346.24
18.78
0.08%
S&P 500
2,510.03
3.18
0.13%
Nasdaq
6,665.94
30.66
0.46%
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 Thursday
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ADP/Moody's reports that the U.S. economy added far more jobs than analysts had anticipated in December. The monthly private employment report shows that U.S. companies added 271,000 new positions for the month. That shattered consensus expectations of 178,000 new hires. Markets have been paying close attention to the jobless rate, which continues to fall despite rising interest rates and concerns about market volatility. The official December jobs report will be released by the Department of Labor tomorrow.
Stocks to Watch Today: NFLX, CELG, DB, UBS
Shares of Netflix Inc. (NASDAQ: NFLX) remain under pressure after Netflix yanked an episode of "Patriot Act with Hasan Minhaj" in Saudi Arabia. The streaming giant pulled the episode - which was critical of the Saudi government and the Crown Prince over the death of journalist Jamal Khashoggi. Netflix said that it received a legal request to pull the episode to comply with the nation's laws. Minhaj, a former correspondent on "The Daily Show" suggested that the United States should reassess its relationship with Saudi Arabia during the episode, prompting a complaint from country's Communications and Information Technology Commission. NFLX stock was off 1.5% in pre-market hours.
In deal news, shares of Celgene Corp. (NASDAQ: CELG) rallied nearly 32% after the company received a cash-and-stock offer from Bristol-Myers Squibb (NYSE: BMY), worth $74 billion. CELG investors will receive one BMY share and $50 for every share of CELG stock that they own. This was a big win for CELG investors given that the stock has fallen by 37% over the last 12 months. The firm is poised to lose patent protection in 2022 for its best-selling drug Revlimid. BMY stock was off more than 12% after news of the deal.
Speaking of deal news, European markets are buzzing about a potential mega-merger in the financial space. Officials at Swiss-banking giant UBS Group AG (NYSE: UBS) are bending over backwards to deny that the company may need to merge with another powerful institution. This morning, the company's Chairman Axel Weber denied rumors that the firm is looking at a deal with Deutsche Bank (NYSE: DB), and said that such a deal would make little sense for his organization. DB officials have also denied that any deal will take place. UBS stock was off more than 1.6% in pre-market hours.
Look for earnings reports from Sonic Corp. (NASDAQ: SONC), UniFirst Corp. (NYSE: UNF), Revolution Lighting Technologies Inc. (NASDAQ: RVLT), and Resources Connection Inc. (NASDAQ: RECN).
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.