China is reportedly preparing to ask the WTO to impose sanctions on the U.S.
Futures on the Dow Jones Industrial Average (DJI) are trading well below fair value this morning. Amid today's light economic and earnings calendar, Wall Street is keeping a close eye on U.S. trade relations. Following President Donald Trump's threats of more tariffs on Chinese goods last week, a recent Reuters report indicates China wants to impose sanctions on the U.S. over a dumping duties dispute initially filed in 2013, and will seek permission from the World Trade Organization (WTO) next week.
Continue reading for more on today's market, including:
- Why stocks could bounce back fast, according to Schaeffer's Senior V.P. of Research Todd Salamone.
- Analyst: This tech stock can rally another 25%.
- This energy name could be on the brink of a breakout.
- Plus, Yum China flirts with new lows; a fresh PayPal price target; and Snap gets upgraded.
5 Things You Need to Know Today
- The Chicago Board Options Exchange (CBOE) saw 844,877 call contracts traded on Monday, compared to 519,797 put contracts. The single-session equity put/call ratio fell to 0.62, and the 21-day moving average stayed at 0.62.
- A group of Chinese investors, including Hillhouse Capital, has reportedly dropped its bid for Yum China Holdings Inc (NYSE:YUMC). According to Bloomberg, the consortium will not pursue a buyout of the fast-food operator after its initial offer was rejected. YUMC stock is down 10.5% ahead of the bell, and is on pace to revisit its late-July annual low near $32.
- KeyBanc Capital raised its price target on PayPal Holdings Inc (NASDAQ:PYPL) to $105 from $100, a nearly 17% premium to last night's close at $89.80. PYPL stock has pared a portion of its strong August gains this month, but has found a foothold atop its 40-day moving average.
- Wedbush upgraded Snap Inc (NYSE:SNAP) to "outperform" from "neutral," and raised its price target to $12.25 from $11.50 -- representing expected upside of almost 26% to Monday's close at $9.74. This follows yesterday's news that Chief Strategy Officer Imran Khan will be leaving, which sent SNAP stock to a record intraday low of $9.55. Snap shares are up 1.6% in pre-market trading.
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The Labor Department's Job Openings and Labor Turnover Survey (JOLTS), the NFIB small business optimism index, and wholesale trade data will headline today's action. Francesca's (FRAN) and Farmer Brothers (FARM) will report earnings.
Trade Concerns Weigh on European Stocks
It was a mixed session for Asian benchmarks after the White House late Monday announced plans for a second meeting between President Trump and North Korean leader Kim Jong Un. The main headline was the Hang Seng extending its drop into bear-market territory for a second day, with the Hong Kong-based index losing 0.7%. China’s Shanghai Composite followed suit with a 0.2% decline, and South Korea’s Kospi dipped 0.2%, as well. However, Japan’s Nikkei managed to rally, adding 1.3%.
Despite a relatively strong start, European stock markets have turned lower at midday. Trade concerns are weighing yet again, with traders digesting reports that the U.S. and European Union are hoping to get a trade deal done in the coming months. Investors are also considering tepid employment data out of the U.K. As such, London's FTSE 100 and the German DAX are both down 0.7%, and France’s CAC 40 is off 0.4%.