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The Dow Jones news today will feature another round of earnings reports and the Senate's vote on a new healthcare bill. Dow Jones future are up over 100 points this morning after Caterpillar Inc. (NYSE: CAT) blew away expectations with its earnings report.
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Here are the numbers from Monday for the Dow, S&P 500, and Nasdaq:
|Index||Previous Close||Point Change||Percentage Change|
Now here's a closer look at today's most important market events and stocks, plus Tuesday's economic calendar.
The Five Top Stock Market Stories for Tuesday
- Markets pushed higher after a positive earnings report from Caterpillar Inc. CAT stock rallied more than 5.3% in pre-market hours after the heavy construction manufacturer crushed Wall Street earnings expectations. The firm reported EPS of $1.49 compared to the $1.26 expected by analysts. The company also topped revenue expectations of $10.93 billion by roughly $400 million. The positive report comes while the company is still under investigation by the Internal Revenue Service over the finances of its Switzerland-based subsidiary. The company also hiked its 2017 forecast.
- According to reports, Sen. John McCain (R-AZ) is slated to return to the U.S. Senate to vote on a replacement bill for the Affordable Care Act. McCain was recently diagnosed with a brain tumor. The dramatic return comes at a time that many Republican senators remain unconvinced by the bill to overhaul the U.S. health insurance industry. At least six Republican members of the Senate have expressed doubts about the proposal. Republicans can only afford to lose two votes if this bill has any hope of passing.
- The Federal Reserve kicks off its July meeting Tuesday. The Fed Open Market Committee is not expected to raise interest rates this month, but they will hopefully provide additional insight into the central bank's plans to begin unwinding its massive multitrillion-dollar balance sheet. The Fed has raised interest rates three times since December 2016, and markets anticipate one additional rate hike this year. That said, Money Morning Capital Wave Strategist Shah Gilani has warned about the Fed's plans, including what could happen to the markets as soon as September. Read his insight, right here.
- It may be a light day of economic data, but investors need to keep an eye on the Housing Market Index, set for release this morning. This report comes a day after we learned that home resales fell in the United States thanks to a shortage of supply and record-high prices. While the labor market continues to create positive economic gains, demand for homes has risen to a very high level. A shortage of properties has fueled a bidding war, and home prices are outpacing gains.
- Crude oil prices were pushing higher for the second consecutive day as markets reacted positively to plans by Saudi Arabia to curb exports. The largest member of OPEC announced its intentions during a meeting with other members and non-members in Russia. The Saudis are attempting to divert attention away from rising U.S. production and reports that Iraq – the cartel's second-largest producer – has largely failed to comply with the existing deal to cap excessive production. The WTI crude oil price today added 1.7%. Brent crude gained 1.6%.
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- Shares of Alphabet Inc. (Nasdaq: GOOGL) were off more than 2.5% after the company posted earnings after the bell Monday. The outrage from investors has been Alphabet's reluctance to break out the total revenue generated by its second-largest business, online video behemoth YouTube.
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- In deal news, Michael Kors Holdings Ltd. (NYSE: KORS) surprised investors this morning after it announced plans to spend $1.2 billion for shoemaker Jimmy Choo.
- Meanwhile, General Motors Co. (NYSE: GM) dropped 0.7% in pre-market hours after the company's quarterly profits fell in the second quarter. While the company did top second-quarter EPS expectations of $1.89 by $0.20, the firm reported a slowdown in automotive sales. Traders were also disappointed that the company didn't make any positive changes to its outlook or revenue expectations.
- Shares of 3M Co. (NYSE: MMM) fell nearly 3% this morning after the consumer goods manufacturer reported earnings below Wall Street expectations. The firm reported EPS of $2.25. Wall Street analysts had expected $2.54 per share. The firm also reported a revenue figure below expectations. The only positive from this morning's report was news that the firm hiked its full-year financial outlook.
- Look for additional reports today from McDonald's Corp. (NYSE: MCD), Chipotle Mexican Grill Inc. (NYSE: CMG), Wynn Resorts Ltd. (Nasdaq: WYNN), Texas Instruments Inc. (NYSE: TXN), AT&T Corp. (NYSE: T), Juniper Networks Inc. (Nasdaq: JNPR), Amgen Inc. (Nasdaq: AMGN), and United States Steel Corp. (NYSE: X).
Tuesday's U.S. Economic Calendar (all times EDT)
- Redbook at 8:55 a.m.
- FHFA House Price Index at 9 a.m.
- S&P Corelogic Case-Shiller HPI at 9 a.m.
- Consumer Confidence at 10 a.m.
- Richmond Fed Manufacturing Index at 10 a.m.
- State Street Investor Confidence Index at 10 a.m.
- Four-Week Bill Auction at 11:30 a.m.
- Two-Year Note Auction at 1 p.m.