What we covered here today
- US stocks finished higher on trade hopes.
- Anthony Scaramucci told CNN Business that impeachment won’t matter to the markets.
- The dollar rose as the political and trade climate grew uncertain.
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What’s moving markets today: September 25, 2019
20 Posts
US stocks finish higher in their best day in 2 weeks
Stocks closed higher on signs that the United States could reach a trade deal with China. Markets were unfazed by the turmoil surrounding the impeachment inquiry into President Donald Trump.
It was the best day for stocks in two weeks. The S&P 500 and the Nasdaq Composite both snapped three-day losing streaks.
Stocks that are sensitive to the trade war performed well. Nike (NKE), Intel (INTC) and Dow Inc (DOW) were the biggest gainers in the Dow.
Marathon Petroleum (MPC) was the best performer in the S&P 500, closing more than 8% higher after activist investor Elliott Management called for the company to split up. Marathon said it would thoroughly evaluate the proposal.
Fed's James Bullard wanted a bigger rate cut. He still does: 'Use your tools while you have them.'
The Federal Reserve cut interest rates for a second time in a row last week, but on the whole the Fed’s policymakers don’t foresee further cuts in 2019. One member of the Fed’s policy committee, St. Louis Fed President James Bullard, spoke in favor of more interest rate cuts during an interview with CNBC.
The central bank “could do more” given that the yield curve was still inverted, Bullard said. “We probably have a bit more to go.” Bullard dissented from the Fed’s quarter percentage point cut last week because he wanted a half percentage point reduction.
The typical argument against that bigger rate cut was that the Fed should hold onto its ammunition in case the US economy worsens. But Bullard doesn’t buy it: The Fed should “use the tools while you have them.” He believes the prudent course is to lower rates further and then reconsider what to do next year.
Marathon Petroleum leads S&P 500 after Elliott Management calls for split
Oil and gas refiner Marathon Petroleum (MPC) is the strongest stock in the S&P 500, rallying some 8%.
The company climbed after responding to a letter by activist investor Elliott Management, which called for the split of the company.
Marathon “welcomes constructive input related to enhancing shareholder value,” the company said in a press release in response, adding that it “will thoroughly evaluate Elliott’s proposal and look forward to continuing our constructive engagement around these issues.” (Elliott recently took a large stake in AT&T, whose media division, WarnerMedia, is the parent company of CNN.)
Trade-sensitive stocks are leading gainers
Stocks are still going strong with just about an hour of trading left in the day.
Companies sensitive to trade and with business in China are leading gainers, after President Donald Trump said earlier that a trade deal with China could happen soon.
Nike (NKE), Intel (INTC) and Dow Inc (DOW), are the best performers in the Dow. The index is up some 170 points as a whole.
Nike also reported better-than-expected earnings after the bell on Tuesday.
Scaramucci discounts Elizabeth Warren's potential to win in 2020
When he was asked to weigh in on the 2020 presidential contest, former White House Communications Director Anthony Scaramucci said he was more worried about a second term for President Donald Trump.
“President Trump is scarier to me than ‘President Warren,’” Scaramucci told Alison Kosik on the CNN Business digital live show Markets Now. But, he added, he doesn’t believe Warren will be elected. “President Warren isn’t going to happen,” Scaramucci said.
A recent poll showed Senator Elizabeth Warren and former Vice President Joe Biden as head-to-head for the Democratic nomination to challenge Trump in November 2020.
Scaramucci also criticized the wealth tax proposals that Warren and fellow Democratic presidential candidate Senator Bernie Sanders have put forward.
“The wealth tax won’t work,” Scaramucci said. “These socialists think people like me have my money in a swimming pool with $100 bills,” he said. “My money is in my company and invested in real assets, and my money is helping to create jobs in the society.”
Anthony Scaramucci says impeachment doesn't matter to the market
“I don’t think impeachment matters to the market,” Anthony Scaramucci, former White House communications director, told Alison Kosik on the CNN Business digital live show Markets Now.
The Dow was up more than 130 points, or 0.5% Wednesday, while the S&P 500 rose 0.3% and the Nasdaq Composite rose 0.4%. The market jumped after Trump said a trade deal with China could happen soon.
China would benefit from a Trump re-election, Scaramucci added, saying the president is destroying the United States’ geopolitical standing, or soft power.
Anthony Scaramucci calls out Trump's 'prima facie lawlessness' over whistleblower case
Anthony Scaramucci, the investor and former White House communications director, hit out at President Donald Trump for what he called Trump’s “prime facie lawlessness.”
“This is a lack of morality on the president’s part, a lack of understanding what the laws are. … I think people are now recognizing that the gig is up,” Scaramucci, the founder of Skybridge Capital, said on CNN Business’ digital live show Markets Now.
He said on Twitter that the transcript released earlier of the call between Trump and Ukrainian President Zelensky “was way more damning” than he thought it would be.
“You’re in a full-blown constitutional crisis,” Scaramucci told CNN Business’ Alison Kosik.
Safe-haven dollar climbs as political and trade climate grows uncertain
The safe haven dollar is back and it’s rallying, with the ICE US Dollar Index up 0.6%.
The trade uncertainty and political chaos in the United States is playing in the dollar’s favor. A weak British pound, amid more Brexit turmoil, and a weak euro are helping further.
Over the past years, the greenback has become a safe haven for investors. Traditional safety bets in the currency world are the Japanese yen and the Swiss franc, which tend to rise in times of trouble.
But with European economies are slowing down, as is the world economy, while the United States keep chugging along, which makes the dollar more attractive. Even amid the trade war with China, America’s economy has remained afloat. All this bodes well for US assets and the buck.
The dollar’s leading role in global payments systems is helping matters.
One person who won’t be happy to hear about the dollar’s climb will be President Donald Trump, who has long called the dollar too strong and hurtful to US competitiveness on the global market.
Stocks bounce higher as Trump says deal with China could be reached soon
Stocks bounced to their session highs as President Donald Trump said a deal with China could happen soon, according to multiple reports.
The Dow climbed some 150 points, or 0.6%, highlighting once again that trade is the story that matters most for the markets.
The S&P 500 was up 0.3%, and the Nasdaq Composite climbed 0.2%.
New home sales took off in August
New home sales in the United States grew more strongly than expected in August.
Sales rose a whopping 7.1% over the prior month — well above a Refinitiv consensus forecast of 3.5%.
Translation: 713,000 new homes were sold in August.
The July numbers were revised higher, now showing a 8.6% contraction of sales versus 12.8% in the first reading.
Wall Street doesn't have a 'playbook' for this
The impeachment inquiry into President Donald Trump adds to the mounting uncertainties hovering above markets. The US-China trade war is still raging. Recession odds are on the rise. And now this.
No matter how far the impeachment proceedings go, this is yet one more question mark clouding the outlook for the longest economic expansion and the longest bull market in American history.
History offers limited examples of how the market performs during impeachment proceedings. And those examples, of course, didn’t happen in the middle of a trade war.
Dow edges into positive territory after Ukraine call transcript release
US stocks continue to trade mixed after the White House released the call transcript between President Donald Trump and Ukrainian President Zelensky from July.
The Dow edged into positive territory but the S&P 500 and the Nasdaq Composite stayed in the red.
The Dow was last up 0.1%, or roughly 30 points. The S&P is off by 0.2% and the Nasdaq is down 0.4%.
Stocks open mixed as political chaos looms over markets
US stocks started the day mixed, as investors are coming to grips with what the impeachment process could mean for the trade war with China and the ratification of the new US-Mexico-Canada trade agreement.
- The Dow opened 58 points, or 0.2%, higher
- The S&P 500 and the Nasdaq Composite opened flat.
Nike (NKE) shares opened nearly 6%. The company posted better-than-expected second quarter earnings late Tuesday.
In big tobacco, Philip Morris (PM) and Altria (MO) abandoned their merger talks. Shares of Philip Morris opened more than 7% higher, while Altria stock was up 1%.
eBay (EBAY) stock slipped 1.7% at the open, after the company announced that its CEO had stepped down.
eBay CEO steps down
eBay’s CEO is out.
Devin Wenig, the e-commerce platform’s CEO, is the latest tech boss to step down.
Given “a number of considerations, both Devin and the board believe that a new CEO is best of the company at this time,” eBay (EBAY) said in a press release.
eBay appointed senior vice president and chief financial officer Scott Schenkel as interim CEO, while the company’s board will look for a new leader among internal and external candidates.
eBay affirmed its full-year guidance of 2% to 3% of currency-neutral revenue growth.
Wenig tweeted about his departure, saying “in the past few weeks it became clear that I was not on the same page as my new Board.”
He added it had been “an incredible priviledge to lead one of the world’s great businesses for the past 8 years.”
Big shakeup in big tobacco
What a morning to be in the business of nicotine.
The CEO of e-cigarette business Juul, Kevin Burns, is stepping down.
His resignation comes as Juul and the rest of the vaping industry face a crisis due to growing health concerns about vaping. Several states are moving to ban vaping products.
Read CNN Business’ story here.
In the world of more traditional cigarettes, Philip Morris and Altria ended merger talks.
The companies have been under one roof in the past, but dropped their discussions to reunite in what could have been a $200 billion merger.
Shares of Philip Morris (PM) are up more than 7% in premarket trading, while Altria (MO) stock is up more than 4%.
US stocks to open lower
US stock futures are pointing to a lower open as investors come to grips with the political and trade chaos that ensued yesterday.
House Speaker Nancy Pelosi announced an impeachment inquiry of President Donald Trump late Tuesday. Earlier in the day, Trump called out China’s trade practices during a speech at the United Nations. That knocked markets and the Dow fell more than 200 points at its worst.
The impeachment procedure is unlikely to lead to Trump’s dismissal, BMO senior economist Sal Guatieri said in a note to clients. But “it could distract Congress from ratifying the USMCA and distract the President from signing a trade deal with China.”
Uncertainty is bad for stocks.
Futures for the Dow are some 40 points, or 0.2% lower. S&P 500 futures are off by 0.2% and Nasdaq Composite futures are 0.4% lower.
Global exchanges in Asia and Europe are also in the red.
Today on 'Markets Now:' Anthony Scaramucci
In a tweet that he pinned to the top of his Twitter feed, Anthony Scaramucci says he “made a mistake” supporting President Donald Trump. The tweet links to an August op-ed Scaramucci wrote about the White House for The Washington Post.
But it seems the broader market is still enthusiastic about many of the president’s economic and trade policies.
Stocks are close to all-time highs, despite concerns about tariffs and a generally chaotic atmosphere in the White House — a situation that Scaramucci briefly participated in firsthand in his 11 days as Trump’s communications director before his firing July 2017.
Scaramucci has since returned to SkyBridge Capital, the alternative investing firm he founded, where he is co-managing partner. In the past few weeks, he’s stepped up his attacks against his former boss.
He will discuss this on the “Markets Now” live show Wednesday at 12:45 pm ET.
Asian markets fall broadly on renewed US-China trade concerns
Asian markets dropped on Wednesday, with Hong Kong leading losses, after President Donald Trump’s remarks fueled worries about US-China trade tensions ahead of talks between the two countries.
Nike surges in premarket trading
Nike’s (NKE) focus on selling directly to consumers is paying off in a big way.
The footwear and apparel company on Tuesday posted earnings of $0.86 per share for the three months ending in August, up 28% from the same period in the prior year.
That growth was driven by a 7% increase in revenue and expanding gross margins in direct to consumer sales. Total net income was up 25% in the quarter to $1.4 billion.
The stock is up 6% in premarket trading.
Amazon to show off new products today
Amazon (AMZN) is expected to announce new products and services that will help it maintain its position as the market leader at a press event at its Seattle headquarters.
These are likely to include a wide range of Alexa-infused products for different places in the home and at different prices, as well as updates to Alexa’s functions.
This year, analysts anticipate products that will go in your house and, perhaps, even on your body.
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