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The Dow Jones news today will be dominated by geopolitical events. Dow Jones futures are down 18 points this morning after another terrorist attack hit London over the weekend and as tensions rise in the Middle East.
Here are the numbers from Friday 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, plus Monday's economic calendar.
The Five Top Stock Market Stories for Monday
- The big story today is happening in the Middle East. Reuters reports that Saudi Arabia, Egypt, the United Arab Emirates, Libya, Yemen, and Bahrain have all cut ties with Qatar. The nations have accused the small nation on the Persian Gulf of supporting terrorist networks, including ISIS. Though leaders in Doha deny the charges, the Saudi-led coalition has begun severing diplomatic ties and cutting off airspace for commercial aviation. This is one of the biggest political shakeups in the Middle East in decades.
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- U.S. President Donald Trump vowed that the "bloodshed will end" after another terrorist attack hit Europe. On Friday night, three attackers rammed a van into pedestrians on London Bridge and stabbed other victims. It was the third terrorist attack in Britain in the last three months. Seven people died and 48 were injured. The attack comes just ahead of Britain's parliamentary election.
- Crude oil prices were sliding in pre-market hours on news of the Middle Eastern shakeup over Qatar. Many traders are concerned that this spat could affect the success of the Organization of the Petroleum Exporting Countries' (OPEC) deal to cap excessive production. In late May, OPEC and several non-members of the oil cartel voted to extend its production deal through March 2018. But these new tensions, combined with expectations of rising U.S. production and the possibility of record Russian output, have held prices below $50.00 per barrel. The WTI crude oil price today fell 0.7%. Brent crude dipped 0.8%.
- California has generated headlines by attempting to establish itself as a "Sanctuary State" for immigration laws in defiance of the Trump administration. But last week, the State Assembly took steps to establish itself as something much more interesting for investors. Leaders want to become a "Sanctuary State" for marijuana. A bill that passed the State Assembly would bar state and local law enforcement officers – without a court order – from assisting federal officers in the arrest of individuals who use or sell marijuana. And California isn't the only state to take these steps. Money Morning Director of Technology and Venture Capital Research Michael A. Robinson says this trend is going to be good for investors in the budding marijuana industry. Here's how you can start profiting now.
- In Japan, residents of a small coastal town held evacuation drills as fears accelerate over North Korea's nuclear weapons program. Last week, the "Hermit Kingdom" launched another nuclear test in defiance of UN sanctions warnings and threats of possible U.S. military action. Over the weekend, U.S. Secretary of State Rex Tillerson said that China must "step up their efforts" to address its unstable neighbor and the regime of Kim Jong Un. But there's another terrifying story about North Korea that has gone largely unreported. And this threat could dramatically alter the American way of life.
Five Stocks to Watch Today: HLF, TM, GM, TSLA, FOR
- Shares of Herbalife Ltd. (NYSE: HLF) fell more than 6.3% in pre-market hours after the company raised its profit outlook but slashed its forward guidance on revenue. The nutritional giant hiked its expected earnings per share range. However, it warned that its sales will fall by as much as 6% due to changes in Federal Trade Commission (FTC) guidelines. The company also reported that sales could sag in Mexico, one of its key international markets.
- Toyota Motor Corp. (NYSE ADR: TM) has sold its remaining stake in Tesla Inc. (Nasdaq: TSLA), a quiet deal that brought the two firms' six-year partnership to a close. For Tesla, the news comes as it prepares for a proxy battle later this week at its annual shareholder meeting. Two proxy services have supported a measure to alter the company's board structure and add independent directors who have no ties to company CEO Elon Musk.
Why Ford Is the Car Stock We're Watching
- Tesla isn't the only company that makes cars to face a challenge from shareholders. This week, David Einhorn will attempt to influence General Motors Co. (NYSE: GM) shareholders into splitting the company's stock into two different classes. Einhorn says that doing so would create "billions of dollars" in shareholder value. General Motors executives have called his proposal a "high-risk financial engineering experiment."
- In deal news, shares of Forestar Group Inc. (NYSE: FOR) added more than 13% after the company received a large bid from homebuilder D.R. Horton for 75% of the company. Forestar is a residential land developer and would remain a public company if the $520 million deal is accepted by shareholders. The offer is roughly 14% higher than an offer from investment firm Starwood Capital Group.
- Look for additional earnings reports from Thor Industries Inc. (NYSE: THO), Ascena Retail Group Inc. (Nasdaq: ASNA), Casey's General Stores Inc. (Nasdaq: CASY), and JinkoSolar Holding Co. (NYSE: JKS).
Monday's U.S. Economic Calendar (all times EDT)
- Productivity and Costs at 8:30 a.m.
- Gallup U.S. Consumer Spending Measure at 8:30 a.m.
- PMI Services Index at 9:45 a.m.
- Factory Orders at 10 a.m.
- ISM Non-Manufacturing Index at 10 a.m.
- Labor Market Conditions Index at 10 a.m.
- Four-Week Bill Announcement at 11 a.m.
- Three-Month Bill Auction at 11:30 a.m.
- Six-Month Bill Auction at 11:30 a.m.
- TD Ameritrade IMX at 12:30 p.m.