Dow Futures Signal Stock Pullback

Dow Jones Industrial Average (DJI) futures are trading modestly below fair value after yesterday's triple-digit rally, signaling a lower open for stocks this morning. With little on today's economic calendar, the S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) look set for weaker price action, as well. In fact, many investors may already be playing it safe ahead of Friday's nonfarm payrolls release.

Continue reading for more on today's market, including:

• Schaeffer's Senior V.P. of Research Todd Salamone details a sector to avoid after the Fed's rate hike.
• Analysts say buy these 2 pharma stocks.
• The "horsemen" of the dot-com era have re-emerged, explains Schaeffer's founder and CEO Bernie Schaeffer.
• Plus, PepsiCo's earnings reaction; Stitch Fix sells off; and Kroger teams up with Walgreens.

5 Things You Need to Know Today

1. The Chicago Board Options Exchange (CBOE) saw 979,404 call contracts traded on Monday, compared to 556,812 put contracts. The single-session equity put/call ratio fell to 0.57, and the 21-day moving average held at 0.60
2. PepsiCo, Inc. (NASDAQ:PEP) is set for a lower open after earnings. The snack and beverage giant is down 0.8% in pre-market trading, giving up earlier gains, even after beating on the top and bottom line. If the losses hold, it'll be welcome news for the bearish options traders who targeted the stock ahead of the event.
3. Stitch Fix Inc (NASDAQ:SFIX) is also in the red after earnings, down almost 19% in pre-market trading. The company topped earnings estimates, but revenue and active users were lower than expected for the quarter. SFIX options traders were quite bullish ahead of earnings -- though it's hard to blame them, since the shares had more than doubled since early June.
4. Kroger Co (NYSE:KR) and Walgreens Boots Alliance (NASDAQ:WBA) have announced what they're calling an exploratory pilot program to bring Kroger pick-up to certain Walgreens locations. KR shares are trading up 2.4% before the open after a recent meet-up with their 200-day moving average, while WBA is fractionally higher.
5. Today investors will hear testimony from Fed Vice Chair Randal Quarles, speaking before the Senate Banking Committee. Powell will take the mic at 12:00 p.m. ET at the National Association for Business Economics annual meeting in Boston. Motor vehicle sales numbers are also due out, and Paychex (PAYX) will release earnings.

Italy Woes Weigh on European Markets

Stocks in Asia closed mixed, as trade tensions between the U.S. and China ramped up. Hong Kong's Hang Seng finished significantly lower upon return from its long weekend, down 2.4%, while South Korea's Kospi suffered a 1.3% loss. On the flip side, Japan's Nikkei eked out a 0.1% gain, while China's Shanghai Composite remained closed for holiday.

European markets are lower in afternoon trading as focus remains on Italy's latest budget plan, sending bond yields surging in Rome and bank stocks tumbling across the region. London's FTSE 100 is down 0.3%, while France's CAC 40 and the German DAX are 0.6% lower, at last check.