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At the closing bell, the Dow Jones Industrial Average today dropped 159.84 points to finish at 16,412.71. The Nasdaq fell 110.01 points finish at 4,127.73, while the S&P 500 lost 23.67 points to end the day at 1,865.10.
A big reason for today's market fall: The U.S. jobs report disappointed.
Despite positive revisions in jobs for January and February - adding another 37,000 jobs - the tepid figure of 192,000 positions added in March didn't provide a surge to the markets. The numbers just missed "expectations" in this new normal economy.
The announcement isn't bad enough to cause the U.S. Federal Reserve to reverse its pace on tapering its stimulus plans. But this news won't push the Fed to increase interest rates sooner than expected. These lukewarm results only suggest a gross domestic product boost of 2.5% in 2014, which is simply not fast enough growth in this economy. Despite all the stimulus and "extraordinary measures," we're still spinning tires.
Keep in mind that the official jobs figure is rigged. The full-time employment participation rate is sitting at 63.2%. The U-6 rate, which includes part-time workers seeking fulltime jobs, is sitting at 12.7%
And, as Larry Kudlow pointed out on Friday morning, the economy has the resurgent oil and gas sectors to thank for a bit of the job growth that has taken place since hydraulic fracturing (fracking) came online. Without fracking and shady accounting practices, official unemployment would be at far, far worse.
Perhaps it's time to try some other ideas, like tax reform, new education approaches, repealing needless regulations, rolling back Obamacare costs, and eliminating Washington cronyism in order to turn this economy around.
Here's a recap of other major events today.
Major News in the Stock Market Today
- Hungry for Profits: This morning, online food delivery company GrubHub Inc. (NYSE: GRUB) soared more than 40% in its debut on the New York Stock Exchange. The company's initial pricing offering was $26 a share, but shares jumped above $40 at opening. According to its IPO filing, GrubHub processed more than 135,000 revenue-generating orders each day last year. The company's revenue increased by 67% in 2013 to $137 million. Grubhub's opening valuation was nearly 15 times its annual revenue. For where GRUB stock could go next, here's the full story. IMS Health (NYSE: IMS), a healthcare information company; Five9 (NYSE: FIVN), a cloud software provider for call centers; and Opower (NYSE: OPWR), a provider of cloud software to utilities, also experienced successful debuts.
- High-Speed Problems: Attorney General Eric Holder announced that the U.S. Justice Department has launched an investigation into high-speed trading over suspicions of insider trading. The FBI is looking into whether high-frequency traders are able to gain an advantage thanks to their use of algorithms that allow them to rapidly get in and out of trades. We've already told you how HFT works - and how it makes traders rich in 8 simple steps...
- Coal Stocks Surge: BHP Billiton (NYSE: BHP) executive Dean Dalla Valle, who runs the company's coal division, said he expects global demand for coal to increase in the decades ahead. After the statement, stocks in coal companies surged. Shares of Alpha Natural Resources (NYSE: ANR), Arch Coal (NYSE: ACI), Peabody Energy (NYSE: BTU), and Walter Energy (NYSE: WLT) all increased this afternoon by more than 3%. The executive suggested that India will become the new driver of coal demand in the global markets.
- The Cold Burger War: With post-Cold War relations at a low, concerns over the rift between Russia and the West has created new uncertainties for companies with assets in the Crimea region. On Friday, McDonald's (NYSE: MCD) announced it had closed restaurants in the contested Crimean regions, which has raised fears of a trade war. The backlash over the Crimean population being unable to get a Big Mac and fries has led a prominent politician in Moscow to call for the Kremlin to shut down the company's outlets across Russia as well. Shares of McDonald's were up today slightly.
- Big Money for Blankfein: Executives at Goldman Sachs (NYSE: GS) saw another big payday in 2013. The company's CEO Lloyd Blankfein saw his compensation increase by 50% in 2013 to reach $19.9 million, according to the U.S. Securities and Exchange Commission. The payday included $11.3 million in stock awards. Goldman's COO Gary Cohn also received $18 million last year.
Don't Miss These Top Three Profit Opportunities
- Knock Out the Food Inflation Bully: Maybe you've noticed that the price of food has been soaring lately - and at a double-digit clip. Meanwhile, household income is barely rising. But if you know where to invest your money, you can actually make food inflation pay off. This investment idea will get you started on your way to big profits this summer...
- The Best Play in a Trillion-Dollar Market: Activist investor Carl Icahn just cleared our path to a big profit - a company in a hot new market whose shares could surge 50% in the next two years. Michael Robinson wants to tell you how Icahn did this - and show you the stock that's ready to run...
- The Clock Is Ticking: There's an immense new challenge to the U.S. role in the global economy that few are watching. It's a dominant role we've held since the latter part of World War II, and for 70 years it's gone largely unchallenged. Until now. As Shah Gilani explains, the story isn't complicated, but it will be disturbing to some... and profitable to others...
About the Author
Garrett Baldwin is a globally recognized research economist, financial writer, and consultant with degrees from Northwestern, Johns Hopkins, Purdue, and Indiana University. He is a seasoned financial and political risk analyst, with a focus on stocks, hedge funds, private equity, blockchain, and housing policy. He has conducted risk assessment projects for clients in 27 countries, and consulted on policy and financial operations for some of the nation's largest financial institutions, including a $1.5 trillion credit fund, a $43 billion credit and auto loan giant, as well as two of the largest Wall Street banks by assets under management.
Garrett joined Money Map Press as an economist and researcher in 2011, specializing in alternative strategies with an emphasis on fundamental and technical analysis.