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Dow gains as investors prepare for first rate cut in 10 years



  • The Dow Jones Industrial Average rose modestly Monday as investors prepared this week for a probable quarterly return from the Federal Reserve and earnings from nearly a third of S&P 500 companies.
  • Mylan (MYL – Get Report) and Pfizer (PFE – Get Report) agreed to combine their drug companies without patents into a stock price. Mylan is today's real money.
  • Cancer diagnostics company Exact Sciences (Get Report) will acquire Genomic Health (GHDX – Get Report) for approximately $ 2.8 billion.

Wall Street Overview

Shares were mixed Monday, following Friday's record highs for the Nasdaq and S&P 500, as investors look forward to a probable quarterly price from the Federal Reserve and await revenue from nearly a third of the S&P 500 companies.

The Dow Jones Industrial Average rose 43 points, or 0.1

6%, to 27,235, the S&P 500 fell 0.16% and the Nasdaq fell 0.54%.

Pfizer (PFE – Get Report) was lower after the drug maker reached an agreement with Mylan (MYL – Get Report) to combine their non-patented drug companies into a stock portfolio that will create a new US-based company.

Both companies also reported revenue on Monday, with Pfizer hitting revenue expectations but missing revenue, and Mylan topping both earnings and rev enue forecasts. S&P Global Ratings downgraded Pfizer's credit rating from AA to AA after the agreement was announced.

Pfizer shares fell 2.5% to $ 42.03, while Mylan rose 12.4% to $ 20.74. Mylan is today's real money.

The Federal Reserve meets Tuesday and Wednesday, with an announcement of interest rates expected at ET on Wednesday. Fed monitors expect the central bank to cut the reference rate by one quarter, which will mark the first cut in 10 years.

"Economic fundamentals remain relatively healthy, largely fueled by a strong consumer," Glenmede Trust Company's Investment Strategy Team said in a research note. "Although in weaker production conditions and lingering trade frictions, the Fed may take a measure of" insurance "to protect against relatively unpredictable risks. However, officials have noted that an insurance cut may not be without its costs – lower prices can stimulate appetite at risk, which could threaten to overheat markets at a time when valuations are still high. "

Janet Yellen, former chairman of the Federal Reserve, said Sunday that she supports a 25 basis point cut, noting that the economy is weakening" due to trade conflicts and the uncertainty caused to businesses. "

As far as trade is concerned, US-China negotiations are scheduled to resume on Tuesday in Shanghai. Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer will meet with a delegation led by China's economist, Vice Premier Liu He.

President Donald Trump said Friday that he did not know if the world's two largest economies would come to an agreement. "Maybe they will, maybe not," he said. "I do not care."

Trump took to Twitter on Monday, complaining that "Fed" traveled "far too early and too much. "

" Their quantitative tightening was another big mistake, "Trump said." While our country is doing very well, the potential wealth creation that was missed, especially when measured against our debt, is staggering. "

Trump added that "we compete with countries that know how to play the game against the United States"

"That's actually why the European Union was formed," he said. easy choices. ”The Fed has done all the wrong things. A small interest rate cut is not enough, but we will win anyway! "

The Fed" raised "far too early and too much. Their quantitative tightening was probably a big mistake. While our country is doing very well, the potential prosperity that was missed, especially when measured against our debt, staggering We compete with others …..

– Donald J. Trump (@realDonaldTrump) July 29, 2019

Boeing (BA – Get Report ) shares fell 1.4% to $ 340.34 after analysts at Standard & Poor's warned that they could lower the credit rating for the world's largest aircraft manufacturer due to the ongoing crisis in its 737 MAX program. [19659006] Exact Sciences (EXAS – Get Report) cancer company will acquire Genomic Health (GHDX – Get Report) for about $ 2.8 billion, shares of the exact sciences fell 7.6% to $ 109.01, while Genomic Health advanced 3.4% to $ 71.

Parker Hannifin's shares (PH – Get Report) dipped 1.4% to $ 172.39 after the aerospace technology company said it would acquire exotic metal manufacturer Exotic Metals Forming Co. in a $ 1.56 billion cash deal.


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