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The Dow Jones Industrial Average finished slightly past 18,000 during Monday's session thanks to a slew of positive earnings reports and a slight recovery in oil prices. It was the first time that the Dow rallied through the 18,000 ceiling since July 2015.
Here's what else you need to know about the markets on April 18, 2016.
The Shocking Forecast for Oil Prices in 2016: Crude oil prices plunged in 2015, but our forecast points to a turnaround this year that will send the price of oil higher. Don't miss our full-year target and the key developments that will move oil prices in 2016. Read more…
First up, check out the results for the Dow Jones, S&P 500, and Nasdaq:
Dow Jones: 18,004.16; +106.70; +0.60%
S&P 500: 2,094.34; +13.61; +0.65%
Nasdaq: 4,960.02; +21.80; +0.44%
Now, here's the top stock market news today…
DJIA Today: Oil Prices Spiral After Doha Production Freeze Talks Collapse
Consumer discretionary stocks pushed the Dow higher on Monday thanks to strong performances in the toy and gaming industry. Both Hasbro Inc. (NYSE: HAS) and Mattel Inc. (NYSE: MAT) hit 52-week highs this morning after the former beat quarterly earnings expectations. The firm continues to see strong sales from its line of "Star Wars: The Force Awakens" toys.
On the economic front, former Goldman Sachs Group Inc. (NYSE: GS) banker and Minneapolis Federal Reserve Bank President Neel Kashkari called for significant reforms to the U.S. financial system. The central banker is raising concerns that U.S. taxpayers could again be on the hook for another massive bailout unless Congress or regulatory agencies address "Too Big to Fail" banks. The statement comes a week after American regulators rejected capital wind-down plans of five major U.S. banks. The federal agencies ordered the banks to revise their programs or they will hit the firms with sanctions.
Corporate defaults are happening at the fastest pace since 2009. According to S&P Ratings Services, 46 companies have defaulted on their debts this year. The latest defaults were coal producer Peabody Energy Corp. (NYSE: BTU) and surf-wear retailer Pacific Sunwear of California Inc. (Nasdaq: PSUN), which both filed for bankruptcy protection last week.
But the big story today was the price of crude oil. Crude cratered earlier in the trading session on news that the Doha production freeze talks collapsed over the weekend. However, prices slightly recovered on news of a strike among oil workers in Kuwait that will affect roughly 60% of the nation's oil production levels. Investors are watching energy companies, where more defaults are expected this year.
Production freeze talks fell apart after Saudi Arabia demanded that Iran join the agreement to support falling oil prices. Iran didn't even attend the meeting and said it plans to increase its production levels after the Western nations lifted economic sanctions. As Saudi Arabia continues to fight two proxy wars in Yemen and Syria, it's very unlikely that they will sacrifice production levels to rival Iran. WTI crude prices finished the session down a little more than 1.3%, while Brent crude slipped 0.4%. That's a significant turnaround from the 6.5% decline earlier today.
Now, let's look at the day's biggest stock movers and today's must-own stock…
Top Stock Market News Today
- All eyes are on Yahoo Inc. (Nasdaq: YHOO) as the company's deadline for takeover bids is today. According to reports, Verizon Communications Inc. (NYSE: VZ) is considered the favorite to win the auction. Yahoo has been under significant pressure from activist hedge fund Starboard Value to consider "strategic alternatives." According to the Los Angeles Times, at least 40 buyers have looked at Yahoo's books. However, only a few are considered contenders to take on some of the firm's assets.
- Shares of Walt Disney Co. (NYSE: DIS) rallied more than 2.5% after the company's film "Jungle Book" grossed more than $100 million over its first weekend. Shares of 3D screen operator Imax Corp. (Nasdaq: IMAX) also received a boost from the success of the film, adding 2.8% on the day.
- PepsiCo Inc. (NYSE: PEP) beat Wall Street expectations after reporting a positive effort to reduce costs and boost demand for its North American snack business.
- The problems in the financial sector were further highlighted by a weak earnings report by investment bank Morgan Stanley (NYSE: MS). The company's first-quarter profit figure cratered by more than 50% compared to the same period last year. The firm has been affected by a downturn in its trading business and weakness in fixed income.
- After the bell, look for earnings reports from International Business Machines Corp. (NYSE IBM) and Netflix Inc. (Nasdaq: NFLX).
- Finally, here is your stock pick of the day. Global hotspots are popping up all around the world as geopolitical tensions unleash conflict and disaster on humanity. In fact, there are now 60 million people who have been displaced, creating a massive humanitarian crisis. As a result of these problems, global defense spending continues to surge. And you can profit from our favorite defense stock of 2016 here…
The Ultimate Must-Have Investment: Water is going to be the single most important investment of this century. It's likely to deliver big returns to investors who make the right moves, like the ones in this report. Read More…
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.