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The Dow Jones today will struggle to recover after U.S. President Donald Trump's latest tariff threat to China. Details below.
Plus: What this does for our chances of a stock market crash…
Here are the numbers from Thursday for the Dow, S&P 500, and Nasdaq:
|Index||Previous Close||Point Change||Percentage Change|
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
- The Dow Jones was in a free fall Thursday after President Trump announced intentions to slap 10% tariffs on another $300 billion of Chinese goods. Trump said in a series of tweets that the new tariffs are in response to China's failure to purchase more American agricultural products. He also mentioned the continued flow of fentanyl from Chinese producers. Trump said these tariffs will go into effect on Sept. 1 and could increase to 25% in the future.
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- The Federal Reserve is back on notice after President Trump threatened more tariffs and raised the possibility of a recession in the year ahead. The probability of yet another interest rate cut for September jumped to 100% shortly after Trump's announcement. The Fed cut its benchmark rate Wednesday after months of speculation. It was the first time that the U.S. central bank had slashed interest rates since before the 2008 financial crisis. Some analysts argue that Trump issued the tariff threat in order to press the Fed to make a second rate cut this year. Trump has openly criticized the Fed on several occasions and said the central bank is holding down the upside of the U.S. economy.
- Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX) will lead a busy day of earnings reports. The two energy majors are generating headlines a day after U.S. oil prices cratered 7.9% in a single trading session. That slump was the largest one-day decline in four years. The news also snapped a five-day winning streak for U.S. oil prices. This morning, oil prices are rebounding slightly. WTI crude is up 1.1% this morning at $54.50 per barrel. Brent crude is up 1.2% to $61.19 per barrel.
Stocks to Watch Today: AAPL, LOW, ETSY
- Shares of Apple Inc. (NASDAQ: AAPL) are falling after President Trump's new tariff threat. Given that Apple assembles its iPhones in China, the firm is vulnerable to price hikes. Apple previously warned in June that Trump's current tariff plan will impact all of its major product categories. According to Wedbush Securities, consumers will need to pay an additional $75 to $100 to purchase the newer iPhone models.
- Shares of Lowe's Cos. Inc. (NYSE: LOW) are generating buzz after the company announced plans to lay off thousands of employees. The firm plans to outsource a number of these jobs and associated tasks to third-party firms. Since CEO Marvin Ellison took over in July 2018, Lowe's has been shuttering stores across the United States and planning to open a new technology center that will see it hire 2,000 new employees.
- In earnings news, shares of Etsy Inc. (NASDAQ: ETSY) plunged more than 7% after the e-commerce platform reported mixed earnings for the second quarter. Etsy reported earnings per share of $0.14 on top of $181 million. Analysts projected EPS of $0.13 on top of $183 million. The firm said it is working on a series of "bold new initiatives" that will improve its shipping operations.
- Look for earnings reports from PG&E Corp. (NYSE: PCG), Moneygram International Inc. (NYSE: MGI), Berkshire Hathaway Inc. (NYSE: BRK.A), Sprint Corp. (NYSE: S), Arconic Inc. (NASDAQ: ARNC), Cinemark Holdings Inc. (NYSE: CNK), Seagate Technology Plc. (NYSE: STX), Ruth's Hospitality Group Inc. (NASDAQ: RUTH), and Noble Energy Inc. (NYSE: NBL).
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