Futures Fall As Mueller Probes President Trump; Watch These 6 Stocks – Investor’s Business Daily

Stock futures, led by big-cap techs, retreated early Thursday on multiple reports that Special Counsel Robert Mueller is now investigating President Trump himself.

Mueller is probing whether Trump attempted to obstruct justice, the Washington Post reported, later corroborated by several other media outlets. That’s part of his expanding investigation that initially focused on whether Trump campaign aides colluded with Russia officials over meddling with the 2016 presidential election.

Mueller was appointed by the Justice Department to take over the Russia probe in the furor following Trump’s firing of FBI Director James Comey.

Separate reports said that Trump recently had considered firing Mueller, Comey’s predecessor at the FBI.

Trump’s growing political woes generally have not had a big impact on financial markets so far. But Dow futures fell 0.1% below fair value, S&P 500 futures were down 0.2% and Nasdaq 100 futures retreated 0.4%. Those were modestly off the worst levels of overnight trading.

XAutoplay: On | Off On Wednesday, stocks closed mixed following the Federal Reserve’s interest rate hike and hawkish outlook. Financials rallied into the close, with Citigroup (C) and Comerica (CMA) holding buy points while Bank of America (BAC), JPMorgan Chase (JPM), Morgan Stanley (MS) and American Express (AXP) are near entries.

During Wednesday’s regular session, the Dow industrials hit a record high early and rallied to close up 0.2%. The Nasdaq composite fell 0.4% as Apple (AAPL) and other big-cap techs resumed their retreat. The S&P 500 index dipped 0.1%, with energy stocks tumbling with oil prices.

Citigroup, JPMorgan Chase and many other financials are once again looking better, investors should be cautious. First, the market uptrend is under pressure, which means being wary of making new bets of any kind. Meanwhile, the relative strength lines of bank stocks are largely moving sideways with the S&P 500. That’s been trend for many years. Banks may outperform for brief periods, but generally move with the broader market.

Most of these six financial stocks edged down fractionally in late trading.

IBD’S TAKE: Citigroup, Bank of America, JPMorgan Chase and Morgan Stanley are all part of IBD’s Money Center group. To see how they stack up against one another and against objective criteria, go to IBD’s Stock Checkup.


Citigroup broke past a 62.63 flat base buy point last week, and has held on this week. Citi fell to 63.50 intraday, but rebounded to close up 3 cents at 63.72.

On Tuesday, Citi became the latest Wall Street giant to warn of weak Q2 trading revenues.

Bank of America

Bank of America regained its 50-day moving average on Monday, but tested that support Wednesday. By the close, BofA lost just a penny, at 23.76. The stock has a potential aggressive buy point of 24.45, with a conventional flat base entry of 25.90.

JPMorgan Chase

JPMorgan Chase also tested its recently recaptured 50-day line Wednesday, but closed at 87.09, down just 0.2%. The Dow Jones industrial average component has an 89.23 double-bottom buy point in play.

American Express

American Express, also a Dow component and the lone credit card play on this list, rallied to close up 0.3% at 80.84. American Express has an 82.10 buy point in sight.


Comerica, a superregional bank, cleared a 73.51 entry on Tuesday. On Wednesday, shares dropped to 72.59 intraday before reversing higher for a 0.5% gain at 74.26.

The Federal Reserve signaled Wednesday that it will keep raising rates and will begin to rein in its massive $4.5 trillion balance sheet by year-end. Investors took that as a sign that interest rates will rise and spreads will widen, which would bolster banks’ profits. Meanwhile, the Fed will issue stress test results on key financials later this month, following up with its appraisal of dividend and buyback plans. Banks are expected to have little trouble with those oversight exams. Any negative surprises, or unexpectedly big shareholder return programs, could swing individual stocks.

Asian Trading

Japan’s Nikkei fell 0.3% in Thursday intraday trading, while Australia’s S&P/ASX 200 sank 1.2%. China’s Shanghai composite declined 0.1% and Hong Kong’s Hang Seng slid 1.1%.


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