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The Dow Jones now looks positive as airline stocks rally with the reopening of the economy. The S&P 500 is on the verge of breaking higher than its 200-day moving average.
Boeing Co. (NYSE: BA), however, is still fighting for its life. More on this, and all else moving the Dow today, below.
Before we get into this story and more, here are the numbers from Tuesday for the Dow, S&P 500, and Nasdaq:
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Now, here's a closer look at today's most important market events and stocks. We'll also discuss the stories that slipped under the radar of the mainstream financial press on Wednesday.
The Top Stock Market Stories for Wednesday
- This morning, the big news centers on the Trump administration's pending response to China's security law that will impact any remaining independence in Hong Kong. According to Bloomberg News, the Trump administration is considering sanctions against Chinese firms and pledged to make an announcement by the end of the week. It is possible that the Trump administration moves to suspend many Chinese companies from trading on U.S. markets, but such a decision would likely reignite tensions between the two countries once again.
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- Meanwhile, the official number of global coronavirus cases topped 5.6 million on Wednesday, according to Johns Hopkins University. U.S. cases have surpassed 1.68 million, with the country closing in on 100,000 deaths. While most analysts are hyper-focused on the impact of COVID-19 on U.S. President Donald Trump's reelection chances in the fall, the bigger international story centers on the potential downfall of Brazilian president Jair Bolsonaro. Brazil now has the second-highest total of coronavirus cases, and analysts are suggesting that the outbreak – and the administration's failure to prepare – could ultimately topple Bolsonaro.
- Finally, look for Congress to pass yet another coronavirus stimulus bill. According to Senate Majority Leader Mitch McConnell, the Senate will likely decide in the coming weeks on the timing of the next stimulus effort to jump-start the U.S. economy. Recently, Democrats passed a $3 trillion rescue package, but Republicans called it a liberal wish list and stopped its passage. McConnell is reportedly seeking liability protections for U.S. businesses, and may support some relief for state and local governments. However, Republicans are unlikely to provide any bailout money for Amtrak or the U.S. Postal Service, both of which are struggling and could collapse without some level of government intervention.
Stocks to Watch Today: DIS, BA, PZZA, DPZ
- The problems continue to mount for Boeing Co. (NYSE: BA). According to reports, Boeing is going to announce another 2,500 voluntary layoffs this week, according to a statement from the company's union. These layoffs are part of a broader plan to lay off roughly 10% of the company's workforce in the months ahead. Boeing has struggled to secure any new deals given the impact of COVID-19 on the airline industry.
- Walt Disney Co. (NYSE: DIS) will unveil its reopening plans on Wednesday for its theme park in California. The company will submit a proposal to Orange County officials on how it plans to reopen its Disneyland resort. Disney will require approval from the county officials before petitioning to Governor Gavin Newsom.
- COVID-19 has been a boon for pizza delivery companies. This morning, Domino's Pizza Inc. (NYSE: DPZ) said it has experienced a large bounce in demand during the second quarter. Same-store sales increased by 14% from March 23 to May 17. While that figure is impressive, the biggest winner has been Papa John's International Inc. (NASDAQ: PZZA). The company said that its sales surged 33.5% in May, a company record for the second straight month.
- Look for earnings reports today from Workday Inc. (NASDAQ: WDAY), Box Inc. (NASDAQ: BOX), Hewlett-Packard Inc. (NYSE: HPQ), Nutanix Inc. (NASDAQ: NTNX), Autodesk Inc. (NASDAQ: ADSK), and Capri Holdings Ltd. (NASDAQ: CPRI).
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About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.