Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average closed Tuesday more than 1,600 points below its all-time high of 26,616 set on Jan. 26.
- The Nasdaq on Tuesday snapped a seven-session winning streak.
- The S&P 500 is now more than 100 points from its all-time high of 2,872 set on Jan. 26.
Wall Street Overview
Stocks declined on Tuesday, March 13, after trading higher early in the session as investors priced the impact of tame inflation data in the world's biggest economy, Donald Trump's increasingly protectionist stance on trade and business activity, and the ousting of Rex Tillerson as secretary of state.
The Dow Jones Industrial Average finished down 171 points, or by 0.68%. The S&P 500 slipped 0.64% and the Nasdaq fell 1.02%.
Trump tweeted Tuesday that Rex Tillerson was leaving his role as secretary of state and that CIA Director Mike Pompeo would be nominated to replace Tillerson in the high-level position. Deputy CIA Director Gina Haspel will become the new CIA director, making her the first woman to ever hold the position if confirmed.
Meanwhile, consumer prices in the U.S. rose 0.2% in February, pushing the gauge up 2.2% over the past 12 months as an accelerating economy led to higher inflation.
The increases were in line with economists' expectations. Traders have been eyeing inflation reports closely to monitor whether the Federal Reserve will continue its gradual pace of rate increases to keep the economy from overheating and price increases from spiraling out of control.
The central bank's monetary-policy committee raised interest rates three times in 2017, bringing the target to a range of 1.25% to 1.5% from near zero before the central bank started the current hiking cycle in late 2015. A rate increase at a Fed meeting this month is deemed by most traders to be a near certainty.
Market sentiment took a knock Tuesday from Trump's decision to block Action Alerts Plus holding Broadcom Ltd.'s (AVGO) - Get Broadcom Inc. Report bid for Qualcomm Inc. (QCOM) - Get Qualcomm Inc Report on the grounds of national security.
"There is credible evidence that leads me to believe that Broadcom Limited, a limited company organized under the laws of Singapore (Broadcom) ... through exercising control of Qualcomm Incorporated (Qualcomm), a Delaware corporation, might take action that threatens to impair the national security of the United States," said a statement from the White House on Monday, March 12.
Trump's decision effectively blocks the contentious merger battle between the two tech titans. Broadcom was pursuing a $117 billion bid to buy Qualcomm, a deal that would have been the largest ever completed in the tech industry.
Broadcom said it was reviewing the order, adding it "strongly disagrees that its proposed acquisition of Qualcomm raises any national security concerns."
TheStreet's founder Jim Cramer voiced what many were probably thinking off the news.
"Presidential order to shut down Broadcom bid! WOW! Maybe it will be an earnings story now," Cramer tweeted.
Qualcomm shares fell 4.9% on Tuesday. Broadcom declined 0.62%. Intel, which reportedly has considered making a bid for Broadcom if it's successful in its attempt to buy Qualcomm, rose 0.50%.
General Electric tumbled 4.4% following a pessimistic new note from JPMorgan Chase.
The company's targeted full-year 2018 earnings per share of between $1 and $1.07 is "disconnected" from its free cash flow guidance of 75 cents, according to JPMorgan analysts.
U.S. Steel Corp. (X) - Get United States Steel Corporation Report raised its full-year outlook for earnings before interest, taxes, depreciation and amortization on Monday by $200 million to $1.7 billion, with the steel giant crediting recent tariff actions by the Trump administration for the profit hike.
"The company expects the benefits from these actions [on tariffs] will be primarily reflected in our results in the second half of the year, as recent price changes become more fully realized for spot and contract volumes, and shipments increase from Granite City Works," U.S. Steel said in a statement.
Shares of U.S. Steel fell, however, by 7.6% on Tuesday.
United Continental Holdings Inc. (UAL) - Get United Airlines Holdings, Inc. Report , the parent of United Airlines, rose 0.83% after the company said it expects adjusted earnings in 2018 of $6.50 to $8.50 a share; analysts forecast $7.46.
Dick's Sporting Goods Inc. (DKS) - Get Dick's Sporting Goods, Inc. Report slumped 0.98% after the sporting goods retailer's fourth-quarter sales missed estimates and the company said same-store sales in 2018 would come in below Wall Street forecasts.
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