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The Dow Jones today will get a boost from a potential interest rate cut. Economists anticipate that the central bank will take steps to clear the way for an interest rate cut at a future meeting, one that could happen as soon as July.
But that might not be enough to overcome trade war pessimism. More on that front below.
Here are the numbers from Friday for the Dow, S&P 500, and Nasdaq:
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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 Monday
- U.S. President Donald Trump may get his long-desired interest rate cut from the Federal Reserve, although it's unlikely to happen at the FOMC meeting slated for Tuesday and Wednesday. Market watchers anticipate that Fed Chair Jerome Powell will drop the term "patient" to describe the central bank's approach to supporting the U.S. economy on rates. Economists now expect a rate cut as soon as July in an effort to tame concerns about economic growth and the prolonging impacts of a trade war with China.
- While the White House awaits the Fed's action, it appears that President Trump is moving full steam ahead with new tariffs on China. U.S. Commerce Secretary Wilbur Ross said that Trump is about to announced tariffs on roughly $300 billion in additional Chinese goods should the two nations fail to reach an agreement on trade. Ross said he expects both countries to reach a deal – however, he noted that the president is "perfectly happy" to move forward with new tariffs and the reintroduction of suspended tariffs. Ross also said he doesn't expect a deal to be reached later this month, when leaders from the United States and China attend the G-20 Conference, due to the fact that the proposed deal is 2,500 pages long.
- Crude oil prices continued to dip this morning as concerns about global economic growth and oil demand outweigh the ongoing tensions in the Middle East. WTI crude oil was back under $52 per barrel, while Brent crude slipped under $62 per barrel. While Saudi Arabia has signaled an extension on cuts to global production and turmoil exists in the wake of attacks on oil tankers in the Strait of Hormuz, global economic indicators signal bigger problems on the horizon. China's industrial output growth has dropped to its lowest point in 17 years as trade tensions weigh on global demand.
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Stocks to Watch Today: PFE, BABA, BA
- Airline stocks are back in focus as investors eye the Paris Air Show. While companies typically take large orders during the event, Boeing Co. (NYSE: BA) hasn't been able to book an order for a commercial jet in nearly two months. The jet manufacturer has halted deliveries of its 737 Max after two deadly crashes over the last 12 months. Shares of BA stock are off 20% since hitting an all-time high in March.
- In deal news, Pfizer Inc. (NYSE: PFE) announced plans to purchase Array Biopharma Inc. (NASDAQ: ARRY) in a deal worth $11.4 billion, or $48 per share in cash and debt. That represents a 62% jump from Friday's closing price. Array specializes in orphan drugs and cancer therapeutics.
- Shares of Alibaba Group Holding Ltd. (NYSE: BABA) are in focus after the company announced plans for an eight-for-one stock split. The firm plans to announce the split ahead of its debut listing on the Hong Kong exchange.
- No major U.S. companies report earnings today. Look for earnings to pick up again on Tuesday when Adobe Inc. (NASDAQ: ADBE) and Jabil Inc. (NYSE: JBL) report earnings before the bell.