Stock Market News for March 07, 2017

U.S. equities ended in the red on Monday amid concerns over growing geopolitical tensions in Asia. North Korea tested four ballistic missiles off its east coast, three of which landed in Japan’s exclusive economic zone. President Trump, meanwhile, accused his predecessor Barack Obama about wiretapping him, which eventually dragged shares down. Inventors were nervous as such allegations may distract Trump from his pro-growth agenda including tax cuts and deregulations. Optimism about Trump’s policies had powered a record setting rally in Wall Street since the election.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) declined 0.2% to close at 20,954.34, its first close below 21,000 since clearing that milestone on Mar 1. The SP 500 fell 0.3% to close at 2,375.31, with ten of the 11 main sectors finishing in negative territory. Financials and materials were the leading decliners. Financials, which gained the most in the post-election rally, took the biggest hit. The tech-laden Nasdaq Composite Index closed at 5,849.17, decreasing 0.4%.

The fear-gauge CBOE Volatility Index (VIX) gained 2.6% to settle at 11.24. VIX rose for the first time in the last four trading sessions. A total of around 3.2 billion shares were traded on the NYSE on Monday. Decliners outpaced advancing stocks on the NYSE. For 67% stocks that declined, 29% advanced.

North Korea Missile Tests

According to state media KCNA, North Korea’s Hwasong artillery units launched four ballistic missiles, three of which landed within 200 miles of Japan’s coastline in its exclusive economic zone. The report added that the units were part of the “KPA Strategic Force tasked to strike the bases of the U.S. imperialist aggressor forces in Japan in contingency”. North Korean leader Kim Jong Un personally supervised the test and was very much pleased with the unit’s performance, according to KCNA.

Almost 54,000 U.S. troops are stationed in around seven bases across Japan including Misawa Air Force Base on the country’s southernmost islands. Military bases in Japan cost the U.S. government $5.5 billion last year.

Japanese Prime Minister Shinzo Abe said that the missile launches were “a clear violation of UN Security Council resolutions” and a threat to the international community. Meanwhile, Beijing demonstrated frustration with Pyongyang’s nuclear and missile activities and announced a suspension of all coal imports from North Korea until the end of the year.

Trump’s Wiretap Paranoia

President Trump claimed that Barack Obama had instructed a wiretap of Trump Tower in October ahead of November’s election. Trump described “how low has President gone to tap my phones during the very sacred election process. This is Nixon/Watergate.”
 
Trump’s claim that Obama wiretapped him received a strong denial from the former President. Obama said that “my first thought was, only a narcissist on the scale of Donald Trump would think people want to hear more from him than they currently do. If anything, I think we’d all like to hear way, way less.” You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Stocks That Made Headlines

Exxon Mobil to Invest $20 Billion on US Gulf Coast Facilities

Exxon Mobil Corporation (XOM) recently announced its intention to make planned investments of $20 billion through 2022 to expand its chemical and oil refining plants on the U.S. Gulf Coast. (Read More)

General Motors to Sell European Business for $2.3B

General Motors Company (GM) has recently inked an agreement with French automaker, PSA Group, for the sale of its Opel/Vauxhall subsidiary and GM Financial’s European operations. (Read More)

DISH Network to be Added on SP 500: Is the Stock a Buy?

DISH Network Corp. (DISH) received a shot in the arm as the SP Dow Jones Indices issued a statement declaring that the satellite TV operator will be added on the SP 500 GICS (Global Industry Classification Standard) Cable Satellite Sub-Industry index. (Read More)

Zacks’ Top 10 Stocks for 2017

In addition to the stocks discussed above, would you like to know about our 10 finest tickers for the entirety of 2017?

Who wouldn’t? These 10 are painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. They are our primary picks to buy and hold.  Be among the very first to see them

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Exxon Mobil Corporation (XOM): Free Stock Analysis Report
 
General Motors Company (GM): Free Stock Analysis Report
 
DISH Network Corporation (DISH): Free Stock Analysis Report
 
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