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The Dow Jones today will start in the red after U.S. President Donald Trump aborted a missile strike against Iran. Traders will be keeping a close eye on tensions with Iran, plus China continues to play hardball on trade.
Here are the numbers from Thursday 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 Friday
- Oil prices have also rallied this week due to increasing tensions between the United States and Iran. Yesterday, we reported that Iran had shot down a U.S. drone with a surface-to-air missile. The United States claims that the drone was flying over international airspace along the Strait of Hormuz, while the Iranian Revolutionary Guard says it crossed into its airspace. President Trump sounded the war drums by saying Iran had made a "very big mistake." Reports this morning say President Trump ordered a missile strike on Iran before calling it off before any could be launched. U.S. WTI crude oil is now up 9% on the week and looks to close out on strong again today.
- Fed analysts have set a 100% probability that the Federal Reserve will cut interest rates in July. That news comes on the heels of the 10-year U.S. Treasury Bond falling below 2% for the first time since 2016. We could see a lot more movement today thanks to a string of key macroeconomic reports. Watch for updates on the June manufacturing and services PMI and existing home sales report for May during the first 30 minutes of trading on Friday.
- Gold prices topped $1,400 on Thursday for the first time since 2013 before a slight pullback. The six-year high has come on a roller coaster of emotions fueled by the U.S. central bank's pending interest rate cut (according to CME FedWatch), expectations for more stimulus from central banks in Europe and Japan, and ongoing tensions between the United States and Iran in the Strait of Hormuz.
Money Morning Insight of the Day
You've seen how cutthroat Middle Eastern geopolitics could potentially bring massive volatility to the crude sector this year.
But that's just one small piece of a very complicated, tricky puzzle.
There's more - much more - in play in what Dr. Ken Moors is calling the most "shocking prediction of [his] 40-year career."
Stocks to Watch Today: VLO, CAT, CGC
- Shares of Valero Energy Corp. (NYSE: VLO) popped more than 1.5% in pre-market hours. The pop came on speculation that gasoline prices will surge after a massive explosion rocked a major U.S. refinery (not owned by the company) on the East Coast. The three-alarm fire will likely push gasoline price higher at a time that oil prices are already spiking due to growing tensions in the Middle East.
- Shares of Caterpillar Inc. (NYSE: CAT) were off 1% Friday after the industrial equipment manufacturer received a downgrade from Atlantic Equities. Concerns about weaker macroeconomic growth fueled the downgrade.
- Shares of Canopy Growth Corp. (NYSE: CGC) fell 5.1% in pre-market hours after the marijuana producer fell short of Wall Street earnings expectations before the bell. Despite topping revenue expectations, the firm struggled with margins. However, the firm did issue a positive outlook for retail cannabis operations in the wake of Canada's legalization of recreational marijuana.