What's moving markets today
Have investors started to sour on ETFs? According to TrimTabs Investment Research, more than $7.5 billion has plowed into US and global stock mutual funds this month, with US funds taking in $3.4 billion of that.
If American funds finish the month with inflows, it will be the first time that's happened since February 2015. Mom and pop investors pulled $90 billion from US and global stock funds in December as the market tanked. That was the largest monthly withdrawal on record.
The rebound for mutual funds is a win for active money managers who pick stocks instead of blindly betting on indexes, as many ETFs do. Investors have fallen in love with passive ETFs over the past few years because they have lower fees and also have tended to do better than mutual funds.
But US stock ETFs have shed more than $14 billion in January even as the market has bounced back. That's the biggest monthly drop since last February -- when the Dow plunged more than 1,000 points twice in a span of a few days.
The biggest week of earnings season is starting on a gloomy note.
Caterpillar (CAT), a reliable economic bellwether, shocked Wall Street with its biggest earnings miss in a decade. Caterpillar blamed its disappointing results on "lower demand" in China.
Nvidia (NVDA) added to the gloom and doom by slashing its fourth-quarter guidance, sending the stock plunging by 17%. Nvidia similarly cited deteriorating conditions, particularly in China.
Growth concerns also hurt commodities, with US oil prices sliding nearly 3% to $52.14 a barrel.
The selloff comes after the Dow closed narrowly higher last week, notching its fifth straight weekly gain.
Mining giant Vale is facing a backlash from shareholders after the deadly collapse of a dam at a Brazilian mine that it manages.
New York-listed shares of Vale (VALE) tumbled 10% in premarket trading on Monday after officials said at least 58 people have died due to the Friday incident at the Feijao iron ore mine. Another 305 people are still missing.
Brazilian authorities confirmed on Sunday that Brazil-based Vale was responsible for the dam collapse. However, the exact cause of the incident and extent of Vale's responsibility have yet to be determined.
More than $260 million of Vale's funds have been frozen to compensate the government for rescue operations and to support victims. Vale has also been fined $99 million for damages and repairs.
Vale suspended its stock buybacks, dividends and executive bonus plans.
"The company deeply regrets the accident and is making every effort to provide relief and support to those affected," Vale said in a statement.
A slowdown in China is hurting industrial equipment the company. Its sales in its Asia and Pacific unit were down 4% from a year ago, primarily "due to lower demand in China."
The company also lowered its earnings outlook for 2019. The stock is down 16% since January 2018.
Wall Street will turn its attention toward Silicon Valley this week as four of the five most valuable tech companies — Apple (AAPL), Amazon (AMZN), Microsoft (MSFT) and Facebook (FB) — are all set to report earnings.
In previous years, optimism ran high for the tech industry's seemingly limitless potential. Now, warning signs are everywhere.
Apple recently raised alarm bells with a stark warning about weaker iPhone sales, which it mostly attributed to a slowdown in China.
Amazon, meanwhile, spooked investors in October by forecasting weaker sales for the holiday quarter than expected. Since then, the conversation has turned to a new unknown for the company: how CEO Jeff Bezos' divorce could impact his stake in, and control over, the company.
Then there's Microsoft, which regained its title as the world's most valuable company during the final quarter of 2018. Now the question is whether Microsoft can stay on top.
And the tech sector's problems don't stop there. The FTC is reportedly considering a "record" fine against Facebook after months of data privacy scandals, and this year could see an increase in attempts to regulate major tech companies.
US stock futures are pointing lower after a sunny Friday on Wall Street.
We're also keeping a close eye on oil markets: US crude oil futures has just dropped 1.8%, and is trading at $52.70 per barrel.
Slower economic growth in China is adding to worries that demand for oil could drop this year. Meanwhile, rising US production could lead to excess supply.