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Dow Jones Industrial Average News, 4/11/2016: When it comes to stagnating growth in some of the world's largest economies, you have three choices when policy experimentation doesn't provide results: 1) You can take your medicine for all the bad economic policy over the years and allow the economy to heal naturally (albeit in an ugly fashion in the short term); 2) you can introduce badly needed structural reforms to your system in order address the underlying problems that caused the need for that bad monetary policy in the first place; or, 3) you can ignore all the warnings and just "Keep Printing More Money!"
Take a guess at what China is most likely to do?
The expectation of even more financial stimulus had the markets ticking higher today, until earnings worries settled in. The early morning uptick proves that so long as the music is playing, central bankers will dance and keep papering over their economic problems.
It's great for markets in the short term… but without reform, this will end poorly.
Here's what else you need to know about the markets on Monday, April 11, 2016.
S&P 500: 2,041.99; -5.61; -0.27%
Nasdaq: 4,833.40; -17.29; -0.36%
Now, here's the top stock market news today…
DJIA Today: Yahoo! Deal Update, Rising Oil Prices, Teetering Bear Rally
Let's kick off with deal news. Rumors about a Yahoo! Inc. (Nasdaq: YHOO) deal continue to suck up all the oxygen from the conversation. The Wall Street Journal reports the Daily Mail & General Trust Plc. is working with private-equity firms to discuss a deal for the Internet company. Yahoo announced it has extended its first deadline to April 18 for auction bidders, which also include Verizon Communications Inc. (NYSE: VZ), CBS Corp. (NYSE: CBS), and IAC/InterActiveCorp (Nasdaq: IAC).
In central banking news, one current and three former members of the American branch of "The Committee to Destroy the World" – otherwise known as the U.S. Federal Reserve – met last week in a public forum to discuss their work. After this nonsensical event, Money Morning Global Credit Strategist Michael Lewitt had one thing to say about the state of the global markets. You'll want to read his warning right here.
WTI crude oil prices gained 1.6% to settle at $40.36 – the highest settlement in nearly three weeks.
On the economic front, President Barack Obama met with U.S. Federal Reserve Chair Janet Yellen to discuss economic and regulatory issues. Translation: "Ms. Yellen, what can you do to make the bottom not fall out during my last year of office after seven years of uncharted monetary policy?" Yellen is attempting to navigate the normalization of interest rates as concerns about the global economy weigh on investor sentiment.
This pick is still a winner: This stock's 1,300% increase in 12 years is impressive. But this firm's investments in next-generation tech mean the ride isn't over. This stock could surge another 50%…
Now, let's look at the day's biggest stock movers and today's must-own stock…
Top Stock Market News Today
- Earnings season unofficially kicks off today with the release of a quarterly report by global aluminum producer Alcoa Inc. (NYSE: AA) after the bell. The industrial manufacturer is largely seen as a bellwether for global energy and materials stocks as we enter what is expected to be a dismal earnings season.
- The bad news continues for banking stocks. U.S. banking giant Wells Fargo & Co. (NYSE: WFC) admitted it fooled the federal government into insuring a large sum of risky mortgages – meaning they really deceived the American taxpayer into backing these bad mortgage agreements. The company will pay a record $1.2 billion settlement with the U.S. Department of Justice.
- But not to be outdone: Goldman Sachs Group Inc. (NYSE: GS). Today, the New York Attorney General announced the investment bank reached a $5 billion settlement over deceptive mortgage practices, with $670 million to New York State alone. Congratulations, Goldman… you're the vampire that we always knew you were. Now, you're just rubbing it in the face of today's middle class.
- Shares of Facebook Inc. (Nasdaq: FB) fell 1.5% as the company plans to kick off its annual developer conference (F8) tomorrow, April 12, in San Francisco. Company CEO Mark Zuckerberg is set to deliver the keynote speech at the onset. With this big event in focus, it has many investors wondering if they should by FB stock. Here's your answer.
- Shares of Hertz Global Holdings Inc. (NYSE: HTZ) cratered 11.5% after the car rental giant slashed its first-quarter outlook. The firm said it expects its domestic car rental revenue to decline by 2.5% to 3.5%. The firm has been hammered by new ride-sharing services. The firm said its full-year EBITDA guidance is to remain the same, but investors should beware.
- Netflix Inc. (Nasdaq: NFLX) stirred some ire today with the announcement that it's going to be raising monthly prices by $2 per month. The price hike will mostly hit subscribers who were grandfathered in with the $7.99 per month deal. NFLX stock fell 1.1% on the news.
- Finally, here is your stock pick of the day. On Friday, this company received an upgrade from investment firm Credit Suisse Group AG (NYSE ADR: CS) after already rising 87% over the last two years, but this technology giant has plenty more upside to it. Money Morning Defense & Tech Specialist Michael A. Robinson calls this stock a "must-have" play "because the profit potential is massive." He projects its upside is more than 110% from today's level. You won't believe the target price…
The rise of super PACs and "dark money" organizations is undermining the democratic power of you, the average American voter. In this video, we uncover exactly how wealthy donors have hijacked American politics…
Negative Interest Rates Will Kill America's Free Market… Negative interest rates are the latest central bank "flavor of the month," and the fact that this disastrous policy hasn't worked in Europe – or anywhere – won't stop the Federal Reserve from taking NIRP for a spin in the United States. Now's your chance to gain immediate protection from the downside – and even position yourself to profit – when Team Yellen takes rates negative. Don't delay…
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.