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The Dow Jones Industrial Average was down a few points on Monday as investors eyed another round of earnings reports and reacted to updates from the shocking 2016 election season.
Meanwhile, the S&P 500 was flat as investors continue to take a wait-and-see approach with tomorrow's Federal Reserve meeting and the upcoming election. Money Morning Global Credit Strategist Michael Lewitt explains that the S&P 500 has just hit his price target early by 11 months. Now, Lewitt outlines his next forecast for the markets, right here.
Let's look at the final numbers on Monday for the Dow, S&P 500, and Nasdaq:
Dow Jones: 18,142.42; -18.77; -0.10%
S&P 500: 2,126.15; -0.26; -0.01%
Nasdaq: 5,189.13; -0.97; -0.02%
Now, here's a look at today's most important market events and stocks, plus a preview of Tuesday's economic calendar.
DJIA Today: Markets Slip as 2016 Election Thrown into Chaos; Oil Prices Slump
The Dow Jones fell 18 points on Monday after investors eyed another round of economic data and a sharp downturn in crude oil prices. According to the U.S. Commerce Department, consumer spending rose in September more than economists had anticipated. Spending increased by 0.5%, a positive sign ahead of tomorrow's Fed meeting and the U.S. election.
Over the weekend, the 2016 election was thrown into chaos after the FBI announced it was investigating new developments into the case of Hillary Clinton's email server. According to reports, the FBI discovered new emails tied to Clinton aide Huma Abedin, the wife of former U.S. Congressman Anthony Weiner. Following the announcement, the markets shed their gains. The FBI has said it will not be finished with its investigation by the election. However, any damning evidence could lead to a rocky start for Clinton if she wins the election, as Republicans could demand more investigations. We could also see even greater gridlock in Washington in the months ahead.
The U.S. central bank will kick off its penultimate meeting on monetary policy tomorrow. Markets do not expect the Fed Open Market Committee to raise interest rates; however, the markets have placed the odds of a rate hike in December at nearly 79%. Even though no rate hike will likely come before the election, the November FOMC meeting will generate a lot of headlines and affect your investments. Here's everything you need to know ahead of the central bank's meeting.
The price of crude oil today hit a one-month low after new data showed that OPEC exports surged this month. The WTI crude oil price today fell roughly 3.9%, while the Brent crude oil price dipped 2.8%. Investors are increasingly concerned that the OPEC production deal is on the verge of collapse. Money Morning Global Energy Strategist Dr. Kent Moors offers his latest insight on the OPEC deal and where crude prices will be heading next. Read it, right here.
In other energy news, General Electric Co. (NYSE: GE) announced a $32 billion merger with Baker Hughes Inc. (NYSE: BHI). This morning, the two companies announced a deal that will see General Electric own 62.5% of the oil field services giant. Shares of Baker Hughes rallied 8%. The deal is a huge win for General Electric, which pounced on the opportunity after Baker Hughes' planned merger with Halliburton Co. (NYSE: HAL) collapsed due to regulatory pressure.
But the big story today was the FBI's decision to reopen its investigation into Hillary Clinton's emails. Many top Democrats have accused FBI Director James Comey of tampering with the election. In fact, Senate Democrat Harry Reid (D-NV) says that the FBI is now withholding an "October Surprise" that would harm GOP presidential candidate Donald Trump's campaign ahead of Election Day on Nov. 8… What is that surprise? Check it out, right here.
Top Stock Market News Today, Oct. 31, 2016
- Shares of Exxon Mobil Corp. (NYSE: XOM) fell 1.7% after the stock received a downgrade from investment bank Goldman Sachs Group Inc. (NYSE: GS). The financial giant slashed its rating from "Buy" to "Neutral" and lowered its price target to $93 per share. The announcement comes a week after Exxon reported a huge profit decline in the third quarter.
- Shares of Valeant Pharmaceuticals International Inc. (NYSE: VRX) plunged more than 10% to a 52-week low after Bloomberg reported that the government is investigating former CEO Michael Pearson and former CFO Howard Schiller. According to reports, regulators are examining whether the two leaders engaged in accounting fraud. Michael Lewitt has argued that the company's stock is worthless and expects that it will continue to plunge. Here's what Lewitt predicts will happen next to VRX stock.
- Shares of Lumber Liquidators Holdings Inc. (NYSE: LL) plunged more than 17% after a dismal third-quarter earnings report. The company reported a much larger profit decline than Wall Street had expected. The firm has been under incredible pressure over the last two years since a "60 Minutes" report revealed that its flooring products contained chemicals that are known to cause cancer.
- After the bell, look for additional earnings reports from Anadarko Petroleum Corp. (NYSE: APC), Tenet Healthcare Corp. (NYSE: THC), and Olin Corp. (NYSE: OLN).
- Finally, tomorrow's Federal Reserve meeting is a reminder of the failure of central banking. The last eight years have created an overheated market, while the centralized planners continue to ignore the problems that their policies have created. Money Morning Capital Wave Strategist Shah Gilani provides a sound warning to investors on what the world will look like when their experiments ultimately fail. Read it, right here.
Monday's U.S. Economic Calendar (all times EDT)
- Redbook at 8:55 a.m.
- PMI Manufacturing Index at 9:45 a.m.
- ISM Manufacturing Index at 10 a.m.
- Construction Spending at 10 a.m.
- 4-Week Bill Auction at 11:30 a.m.
- Gallup US ECI at 2 p.m.
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