The Dow Jones today is expected to jump by triple digits after a Tuesday quote from U.S. President Donald Trump suggested lowering the capital gains tax, and other tax cuts. The president also continued to put pressure on the Federal Reserve to lower interest rates further.
More on this below.
Also: Earnings reports from Target Corp. (NYSE: TGT) and Lowe's Cos Inc. (NYSE: LOW) are showing signs of a healthy U.S. economy...
Here are the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
Index
Previous Close
Point Change
Percentage Change
Dow Jones
25,962.44
-173.35
-0.66
S&P 500
2,900.51
-23.14
-0.79
Nasdaq
7,948.56
-54.25
-0.68
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 Wednesday
President Trump called out the central bank again this week. The 10-year U.S. Treasury bond has fallen under 1.6%, which is well below the central bank's benchmark level. Investors are getting excited about reports that the White House could push for a payroll tax cut in order to spur economic growth. Trump said the White House is looking at "various tax reductions," a day after his administration denied any truth to those same reports.
Today, the Federal Reserve will release minutes from its recent meeting. Then, the central bank will head off to Jackson Hole for its annual seminar and the Group of Seven summit. Markets will be looking for clues into what the Fed and its counterparts around the globe plan to do in order to spur economic growth. At the moment, the markets have priced in a 16% probability of a rate hike in September. The meeting comes a day after DoubleLine Capital CEO Jeffrey Gundlach raised concerns about the central bank. The prominent financier said that the Fed had lost control of interest rates and cited the recent 2- and 10-year bond rate inversion as evidence. That inversion has predicted every recession of the last five decades.
In geopolitical news, Alibaba Group Holding Ltd. (NYSE: BABA) will delay its IPO on the Hong Kong Stock Exchange. Although the Chinese e-commerce giant already trades on the U.S. market, it has considered a second listing that may raise up to $15 in Asia. However, its plan to list this month has been delayed by "the lack of financial and political stability" in Hong Kong. The company is reportedly exploring October as the month for a listing.
Oil prices ticked slightly higher in pre-market hours. WTI crude added 1% to hit $56.69 per barrel, while Brent crude gained 1.5% to hit $60.92. The gains came thanks to a weekly drawdown in U.S. crude stocks, according to the American Petroleum Institute. The private watchdog cited a cut of 3.5 million barrels of domestic inventory. That was nearly double analyst expectations. Look for the official inventory report today from the Energy Information Administration.
Stocks to Watch Today: TGT, BA, LOW, HD
Boeing Inc. (NYSE: BA) is looking to get its operations off the ground. According to various reports, the aircraft manufacturer has started rehiring to begin production of the Max 737 starting in the fourth quarter. This aircraft has been grounded around the globe for months after two crashes spurred investigations and halts to flights.
Shares of Target Corp. (NYSE: TGT) popped more than 15% in pre-market hours after the company crushed earnings expectations and raised its full-year guidance. The firm reported a 17% jump in second quarter profit thanks to stronger in-store pickup services and same-day shipping gains. It reported earnings per share of $1.82, topping Wall Street expectations of $1.62. Revenue and same-store sales also exceeded forecasts.
Shares of Lowe's Cos. Inc. (NYSE: LOW) were up 12% in pre-market hours after the firm topped Wall Street expectations by $0.14 per share. The home retailer reported same-store sales growth of 3.2%, a figure that easily topped competitor Home Depot Inc. (NYSE: HD) in that department. Frantic buying this morning of LOW stock was a sign that Wall Street now has confidence in new CEO Marvin Ellison, who recently made a string of changes to bolster revenue and improve its lagging past performance.
Look for earnings reports from Lowe's Cos. Inc. (NYSE: LOW), Analog Devices Inc. (NYSE: ADI), Nordstrom Inc. (NYSE: JWN), MSG Networks Inc. (NASDAQ: MSGN), 58.com Inc. (NASDAQ: WUBA), and Children's Place Inc. (NASDAQ: PLCE).
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