CNBC's Domm: Today's Agenda in the Markets
CNBC Executive News Editor
Interest-rate worries and a disappointing outlook from Texas Instruments are taking the punch out of stock prices today. But Lehman Brothers, the first of three brokers to report earnings this week, is a bright spot. The firm had a 27% jump in net profit and its stock is moving higher.
Wall Street is setting up for a weaker opening as European markets trade lower. Asian stocks were mixed overnight, with China closing 1.9% higher. After last week's high volatility, stocks barely budged yesterday. The Dow rose less than a point; Nasdaq fell 1.39 and the S&P 500 was up 1.45 points.
Texas Instrument's stock is trading lower pre-market after the company late yesterday slightly reduced the top end of its second-quarter revenue forecast.
Oil is trending lower after rising $1.21 yesterday to $65.97 per barrel, its biggest one-day gain since May 21. Crude is up 3.1% so far this month.
Stock investors are on inflation watch this week as they await key data that could have some big impact on stocks Thursday and Friday. But CNBC's Rick Santelli says there's an inflation story cooking in the grains markets that we should all be watching. He will be discussing those markets today after yesterday's move up on worries about drought in the East, and too much rain in some areas of the Midwest.
"Corn, wheat, beans spiked. It's this ongoing story that a big chunk of the country is in a major drought. I think it's going to continue to aggravate inflation. If you have a drought, you have grain demand. If you have ethanol, you have grain demand. This is just going to push food prices higher. It really is a big deal," says Santelli from the Chicago futures pits. Corn is at a two-month high and was up 3.8% yesterday, while wheat rose more than 5%, hitting its high for the year. Traders also reacted to a report from the Department of Agriculture which lowered projections for winter wheat production and raised export projections.
Up and Down Wall Street
Goldman Sachs removed Starbucks from its Americas Conviction Buy List today and added McDonald's . Goldman stays positive on Starbucks, but cites risk-reward profile. It expects upward earnings revisions on McDonald's. Goldman also removed Target from the list and said investors may shift their focus to Wal-Mart . Sounds like a call Mad Money's Jim Cramer made weeks ago.
Apple was downgraded to accumulate from buy at Think Equity. The firm's target on the stock is $130, well below the $150 and $160 targets put on it by other analysts.
Big executive pay packages and slumping stock prices are never a happy combination, and that will be a story of the day as Yahoo!'s cranky shareholders attend the company's annual meeting in Santa Clara, Calif. today. CNBC's tech expert Jim Goldman will be there.
Diana Olick will report on how home builders are feeling about the housing market and rising mortgage rates from a J.P. Morgan conference in New York City today.
Taking Aim at China
Four senators will present a new bill today aimed at "misaligned" currency policies. Details will be released this afternoon after the Treasury makes its semiannual report about currencies to Congress. The senators proposing the bill have been outspoken about China's currency policy, which they say unfairly gives China an advantage and hurts U.S. workers and exporters. The senators include Charles Schumer, D-N.Y. and Lindsey Graham R-S.C.