U.S. markets jumped upward after suffering their worst day since October and more in Tuesday’s Closing Bell on Money and Markets.
On Tuesday, President Donald Trump again called for the Federal Reserve to lower the country’s interest rates to help pay down its more than $23 trillion in national debt.
“The Fed should get smart & lower the Rate to make our interest competitive with other Countries which pay much lower even though we are, by far, the high standard,” Trump said in a tweet Tuesday.
The Fed should get smart & lower the Rate to make our interest competitive with other Countries which pay much lower even though we are, by far, the high standard. We would then focus on paying off & refinancing debt! There is almost no inflation-this is the time (2 years late)!
— Donald J. Trump (@realDonaldTrump) January 28, 2020
During its December meeting, the Fed held rates steady after three rate cuts earlier in the year to a range of 1.5% to 1.75%.
The Federal Open Market Committee will wrap up its two-day meeting Wednesday and no changes to the rates are expected.
Trump has said, despite the rate cuts, the Fed is moving too slowly to loosen its policy.
The national debt is up 16.4% since Trump took office in 2016 after he said he would eliminate the debt in eight years as a candidate. The deficit was more than $1 trillion in 2019 alone and projected to move higher this year (story coming Wednesday morning).
Money and Markets: Closing Bell*
S&P 500: 3,276 (+32 points, +1%)
DOW: 28,722 (+187 points, +0.6%)
NASDAQ: 9,269 (+130 points, +1.4%)
GOLD: $1,567.70 (-$13.60, -0.8%)
BITCOIN: $9,085 (+147.43, +1.6%)
U.S. 10-YEAR YIELD: 1.65%
*- as of 4:30 p.m. Eastern time
A Big Win
In Tuesday morning’s Wall Street Wake-Up, we told you about 3M Co. (NYSE: MMM) and its quarterly profit and revenue miss. Shares of the company fell 5.7% Tuesday.
Shares of Pfizer Inc. (NYSE: PFE) were off 5% after the company’s quarterly profits came in under analysts’ expectations.
Meatless product company Beyond Meat Inc. (Nasdaq: BYND) was downgraded to “neutral” by JPMorgan on Tuesday morning. Shares were down 3.7% Tuesday.
M&A News
Auto parts maker BorgWarner Inc. (NYSE: BWA) is acquiring fellow auto supplier Delphi Technologies PLC (NYSE: DLPH) for $3.3 billion. Shares of BorgWarner were down 7.1% and shares of Delphi were up 61% in Tuesday afternoon trading.
Quest Diagnostics (NYSE: DGX) is acquiring assets of Memorial Hermann Health System — a not-for-profit health system in southeast Texas. Terms of the acquisition were not disclosed.
Golden Nuggets
As equity markets gained throughout the day, gold and silver took a hit.
Gold was down $13.60 to trade at $1,567.70 an ounce. Silver was down $0.64 an ounce to $17.44 while platinum was up $4 to $986. Palladium moved up $21 to $2,182.
Cannabis Corner
A cannabis dispensary operator has fallen behind on its payments to vendors. As a result, it’s working with a firm to settle its debts, according to CNN Business.
MedMen Enterprises Inc. (Over-the-Counter: MMNFF), like other cannabis companies, has been hit with a downturn in cannabis stocks.
According to its filing with the Canadian Securities Administration, the company spent $44 million in operations during its quarter ending in September. It made approximately $44 million during the same period.
Cannabis stocks were mostly up Tuesday, paced by Canopy Growth Corp. (NYSE: CGC) jumping 11%. BMO Capital Markets analyst Tamy Chen says CGC is now a “buy” after a rough stretch.
“Canopy is not the only LP in our coverage with value-priced products but we believe the stock at current levels offers a better relative return profile considering that a number of other LPs with value-priced brands will likely continue to be at risk of requiring additional financings,” she wrote in a note to clients.
Innovative Industrial Properties (NYSE: IIPR), a real estate investment trust specializing in leasing property to state-licensed cannabis facilities, was up 8.7%.
Stock Market Update
Orders for U.S.-made large manufacturing jumped in December thanks to an increase in demand for military aircraft.
Durable goods orders jumped 2.4% during the month — the strongest since August. Taking out defense, those orders would have fallen 2.5%, according to the Commerce Department.
The demand for commercial aircraft dropped 74.7% as Boeing Co. (NYSE: BA) continued to have issues with its 737 Max production.
U.S. markets rebounded from its worst day since October as investors continue to work out fears surrounding the coronavirus.
The Dow Jones Industrial Average rose 187 points, or 0.6%. The Nasdaq Composite jumped 1.4% and the S&P 500 climbed 1%.
Today’s Big Winners:
Whirlpool Corp. (NYSE: WHR) +5.6%
PulteGroup Inc. (NYSE: PHM) +5.6%
Trip.com Group Ltd. (Nasdaq: TCOM) +4.7%
American Airlines Group Inc. (Nasdaq: AAL) +3%
Apple Inc. (Nasdaq: APPL) +2.8%
Today’s Big Losers:
BorgWarner Inc. (NYSE: BWA) -7.6%
3M Co. (NYSE: MMM) -5.7%
Pfizer Inc. (NYSE: PFE) -5%
F5 Networks Inc. (Nasdaq: FFIV) -5%
NetApp Inc. (Nasdaq: NTAP) -2.1%
Check back for the most important news and numbers each day after the Closing Bell, only on Money and Markets.
Don’t forget about “Marijuana Markets: a POTcast,” featuring the biggest cannabis news and investment notes from Banyan Hill’s Anthony Planas, here on Money and Markets each Saturday morning.
