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HOW WE GOT HERE
The market continued to watch news coming out of three buildings on Tuesday: Trump Tower, the Eccles Building, and the New York Stock Exchange.
The first building is obvious. Donald Trump continues to meet with people that could potentially serve some role in his new administration (though we really don’t know what Kayne West was doing there). Today he formally named Exxon CEO Rex Tillerson as his Secretary of State, and former Texas Gov. Rick Perry to lead the Energy Department.
Meanwhile, down in the nation’s capital, the Fed began its two-day rate-setting meeting. The central bank is widely expected to announce a 25-basis point rate hike tomorrow. It is so widely expected, in fact, that nobody really cares much about it; the market will be much more focused on what the Fed either says or hints about its plans for next year.
Lastly, traders are keeping an eye on stocks, and the Dow in particular, which today came within 50 points of hitting the 20000 level. One stock that isn’t in the Dow but got attention today was Berkshire Hathaway Class A shares, which today for the first time traded at $250,000 – a level no other U.S. issue has even approached.
Data Front: MBA Mortgage Applications (7:00 AM ET), Producer Prices, (8:30 AM ET), Retail Sales (8:30 AM ET), Industrial Production (9:15 AM ET), Business Inventories (10:00 AM ET), EIA Petroleum Status Report (10:30 AM ET).
Fedspeak: FOMC Meeting Announcement (2:00 PM ET), FOMC Forecasts (2:00 PM ET), Fed Chair Press Conference (2:30 PM ET).
Earnings: Pier 1 Imports, Joy Global.
Politics and Wall Street are mixing as the number two at Goldman Sachs leaves to take a role in Washington. Join Paul Vigna, Liz Hoffman and Aaron Lucchetti for a look at how Trump might change Wall Street, and which banks could benefit most.
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TWEET OF THE DAY
It’s interesting how often good investments don’t really flourish until three years or so after you bought them.
— Eddy Elfenbein (@EddyElfenbein) December 13, 2016
Insomnia, specifically waking up early and not being able to fall back to sleep, can ruin someone’s day before it even begins. WSJ’s Andrea Petersen and Lunch Break’s Tanya Rivero discuss symptoms and tips from experts to overcome it.
NUMBER OF THE DAY
The Dow Jones Industrial Average traded as high as 19953.75 on Tuesday, as the index continues to edge closer to the 20000 level. It closed at 19911.
Aleppo Cease-Fire Clears Way to Evacuate Civilians: A cease-fire deal was reached late Tuesday to allow thousands of civilians and rebels to evacuate from devastated parts of Aleppo and return full control of the Syrian city to the regime of PresidentBashar al-Assad.
Dow Nears 20000 for First Time: Stocks charged toward fresh records Tuesday, bringing the Dow Jones Industrial Average within 50 points of hitting 20000.
Buffett’s Latest Milestone: Berkshire at $250,000: Fifty-four years and one day after Warren Buffett bought his first shares of Berkshire Hathaway Inc., the company he transformed from a failing textile concern into a global powerhouse entered the $250,000 club.
Deals With Putin Helped Fuel Tillerson’s Rise at Exxon: Rex Tillerson was propelled to the top of Exxon Mobil Corp. partly by negotiating a deal with Vladimir Putin to kick-start an oil project in Russia’s Far East, one of a series of agreements between the pair stretching back to 1999.
Buoyant Markets Pose New Challenge for the Fed: A rallying stock market, rising bond yields and the return of inflationary pressures are creating new challenges for the Federal Reserve as it starts its two-day policy meeting Tuesday, with investors already looking past a rate hike and focusing on policy signals.
OPEC Pumped at Record High Last Month: OPEC pumped at record high levels in November, a top energy watchdog said Tuesday, posing a challenge to the petroleum cartel’s plans to slash oil output to support crude prices.
Google Parent Forms Driverless-Car Company: Google parent Alphabet is spinning out its driverless-car technology from a research lab into its own business unit, called Waymo, that soon will be expected to start earning revenue.
Anxious Mutual-Fund Industry Holds ‘Seismic’ Leadership Forum: About 60 rival mutual fund executives gathered inside OppenheimerFunds’ Manhattan office tower in early November to discuss a problem many of them can’t shake: persistent client withdrawals.
CHART OF THE DAY