Stock Market Today: Citigroup’s $7 Billion Charge and MSC Industrial’s Miss

Why Citigroup and MSC Industrial Direct stocks are on the move today.

Jul 9, 2014 at 9:25AM

The Dow Jones Industrial Average (DJINDICES:^DJI) has gained 10 points in pre-market trading, suggesting a flat start to the stock market after yesterday's triple-digit retreat.

Earnings season is ramping up, but today's market-moving news will likely come from the Federal Reserve rather than a public company. The Fed is scheduled to release minutes from its June monetary policy meeting at 2 p.m. EDT, and that update could shed light on when, and how, the central bank might finally begin raising interest rates from the 0% mark in place since 2009.

Fed Rates

Meanwhile, news is breaking this morning on and Citigroup (NYSE:C) and MSC Industrial Direct (NYSE:MSM) stocks, which could both see heavy trading in today's session.

Citigroup is on the hook for as much as $7 billion in penalties to settle government legal claims regarding its past mortgage practices, according to several news reports today. A price tag for any penalty that runs into the billions wouldn't be a surprise, but $7 billion is higher than most analysts had expected. It would also represent more than half of the $13.7 billion the bank earned through all of 2013. Still, investors should be relieved if Citigroup avoids a federal lawsuit, which company executives told The Wall Street Journal would likely be a "long, expensive process and a public-relations nightmare," even if the bank eventually won. The stock was unchanged in pre-market trading.

MSC Industrial today posted a 13% sales improvement for its fiscal third quarter, though the $720.5 million it booked in revenue was below the $727 million that analysts were expecting. Still, the metalworking tools producer hit profit targets right on the nose: earnings landed at $1.06 per share, a slight increase from the prior year's result. Chief Financial Officer Jeff Kaczka said in a press release that those figures put the company "on-track" to deliver on its 2014 profit goals. Sales growth plans are also "progressing well and on schedule," Kaczka said. MSC updated its outlook for its fourth quarter, which now calls for revenue of roughly $725 million and profit of about $1 a share. Those targets were a tad below Wall Street's projections of $728 million in sales and EPS of $1.07. The stock was down 2.8% in pre-market trading.

Leaked: Apple's next smart device (warning, it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are claiming its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts 485 million of this type of device will be sold per year. But one small company makes Apple's gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and see Apple's newest smart gizmo, just click here!

Demitrios Kalogeropoulos has no position in any stocks mentioned. The Motley Fool recommends MSC Industrial Direct. The Motley Fool owns shares of Citigroup and MSC Industrial Direct. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

©1995-2014 The Motley Fool. All rights reserved. | Privacy/Legal Information