Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average fell Wednesday as Wall Street awaited new details on trade talks between the U.S. and China.
- General Electric (GE) extended declines Wednesday, falling 8%, after CEO Larry Culp warned that free cash flow from the conglomerate's industrial division is likely to remain negative this year.
- Abercrombie & Fitch (ANF) jumped 21% after the apparel retailer reported strong holiday-quarter earnings and sales that topped Wall Street expectations.
Wall Street Overview
Stocks ended the day lower on Wednesday, March 6, as investors awaited new details on trade talks between the U.S. and China and oil prices tumbled after a larger-than-expected increase in domestic crude stocks.
The Dow Jones Industrial Average fell 133 points, or 0.52%, to 25,673, the S&P 500 was down 0.65%, and the Nasdaq fell 0.93%. Leading the Dow lower were Walgreens Boots Alliance (WBA) , Pfizer (PFE) and Exxon Mobil (XOM) ."Examining the outlook, the market remains a trade driven one as we await the confirmation and details of the trade deal," said Jingyi Pan, a market strategist with IG.
Bloomberg reported Wednesday that Donald Trump has been pressuring U.S. trade negotiators to cut a deal with China soon with hopes of fueling a market rally, as he grows increasingly concerned that the lack of an agreement could drag down stocks. The Bloomberg report cited people familiar with the matter.
Stocks finished lower Tuesday as Wall Street weighed the prospect of a comprehensive trade deal against fragile global economic growth.
The Organization for Economic Co-Operation & Development said Wednesday it expects global GDP to grow 3.3% this year and 3.4% in 2020, forecasts which clip 0.2 and 0.1 percentage points, respectively, from the agency's prior estimates.
"Economic prospects are now weaker in nearly all G-20 countries than previously anticipated," the OECD said. "Vulnerabilities stemming from China and the weakening European economy, combined with a slowdown in trade and global manufacturing, high policy uncertainty and risks in financial markets, could undermine strong and sustainable medium-term growth worldwide."
U.S. employers added fewer jobs than expected in February, according to a private sector reading from payroll services provider ADP, suggesting employment growth in the world's largest economy could be slowing.
Around 183,000 new jobs were created in February, ADP said, just shy of the 187,500 consensus. However, ADP also revised its January report to show a gain of 300,000 from its initial estimate of 213,000.
The reading could affect analysts' forecasts for the official U.S. jobs report from the Bureau of Labor Statistics Friday, which is expected to show around 190,000 new jobs and a headline unemployment rate of 3.9%.
Global oil prices extended declines after the U.S. Energy Information Administration reported a much larger-than-expected increase in domestic crude stocks. The EIA said American oil inventories rose 7.07 million barrels last week to 452.93 million barrels, the highest since December 2017. The tally largely reflects Tuesday's private estimate from the American Petroleum Institute but tops the 1.2 million Wall Street forecast.
West Texas Intermediate crude prices fell just under 1% to $56.23 a barrel.
The U.S. economic expansion, the second-longest in history and approaching its tenth year, is continuing despite the recent government shutdown, according to the Summary of Commentary on Current Economic Conditions, commonly known as the Beige Book. Ten of 12 Federal Reserve regions reported "slight-to-moderate" growth, while the Philadelphia and St. Louis branches reported "flat" activity.
General Electric (GE) extended losses Wednesday after CEO Larry Culp said free cash flow from the conglomerate's industrial division was likely to remain negative this year but insisted the troubled group would accelerate its ongoing restructuring plan.
Johnson & Johnson (JNJ) received approval from the Food and Drug Administration for a nasal spray for patients with hard-to-treat depression. Shares rose slightly.
The drug, which has been branded Spravato by J&J, is closely related chemically to ketamine, which often is used as a party drug with the nickname "Special K."
The FDA approved Spravato as a fast-acting treatment for patients who have failed to find relief with at least two antidepressants, the Associated Press reported. The drug will cost between $590 and $885 depending on the dosage and before various insurance discounts and rebates.
"This a huge win on multiple levels," said Zev Fima, an analyst with Jim Cramer's Action Alerts PLUS team, which holds J&J in its portfolio. "Morgan Stanley has previously stated their belief that this could be a $1 billion product by 2022. But as big a win as this is for shareholders, it's an even bigger win for out veterans and anyone else dealing with treatment resistant depression. As Bloomberg put it, this is "the first major therapeutic advance for depression since the introduction of Prozac in 1987." We couldn't be happier with the news, this drug will truly save lives."
Abercrombie & Fitch (ANF) jumped 20% after the apparel retailer reported strong holiday-quarter earnings and sales that topped Wall Street expectations.
The company reported that same-store sales rose 3% in the quarter, more than double analysts' average estimates of a 1.47% increase.
Dollar Tree (DLTR) beat Wall Street's fourth-quarter adjusted earnings expectations but said Wednesday it will close as many as 390 Family Dollar Stores this year and re-brand 200 others to Dollar Tree Stores. The stock rose 5.11%.