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The benefits of low expectations have pushed the markets higher in recent weeks.
But Thursday, the markets hit a speed bump with the Dow Jones Industrial Average sliding 113 points.
In what could be the most insane quarter of earnings reports in a generation, roughly 77% of S&P 500 companies have beaten profit expectations. That's a massive jump from the 63% of companies that typically beat the markets in a quarter, according to Thomson Reuters data. But keep in mind, consensus expectations called for firms to report a 7.2% average decline in profits.
Here's what else you need to know about the markets on April 21, 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. Read more…
First up, check out the results for the Dow Jones, S&P 500, and Nasdaq:
Dow Jones: 17,982.52; -113.75; -0.63%
S&P 500: 2,091.48; -10.92; -0.52%
Nasdaq: 4,945.89; -2.24; -0.05%
Now, here's the top stock market news today…
DJIA Today: The Stock to Buy Before the FOMC Rate Meeting Next Week
It seems like President Obama's U.S. Treasury Department and other federal agencies are trying to cram eight years of new regulations into a three-month period.
The latest regulatory proposals center on how much money Wall Street executives can receive in salaries and bonuses. Today, the U.S. Securities and Exchange Commission, the Federal Reserve, and others proposed rules that would curb financial executives from taking risky positions in order to boost their pay. The rules would require a seven-year waiting period for firms to "claw back" or repossess bonuses if executives' actions negatively affect their institutions.
Oil prices reversed Thursday as concerns about a global glut returned to traders' minds after energy market intelligence firm Genscape reported a massive build of inventories happened last week. The firm said that the delivery point at Cushing, Oklahoma, added 840,000 barrels in the four days leading up to April 19. WTI crude prices fell 1.6%, while Brent prices slid 2.2%.
In recent sessions, oil prices had been moving higher due to a variety of factors expected to impact supply. First, a number of global oil producers announced plans to meet in Russia next month to try again to build a consensus to freeze output in order to support price. Meanwhile, the International Energy Agency announced the price decline over the last 18 months drove non-OPEC producers to slash investment by up to 40% since 2014.
On the economic front, weekly jobless claims fell below the psychological level of 247,000 for last week. Weekly unemployment claims have fallen to their lowest levels since 1973.
Meanwhile, the Philadelphia Fed Index contracted in April, raising new concerns about the health of the U.S. manufacturing sector. The monthly index slipped -1.6, far below the 10.5 reading that economists had expected. In March, the reading hit 12.4, the first positive reading in seven months.
Now, let's look at the day's biggest stock movers and today's most important stock strategy…
Top Stock Market News Today
- SunEdison Inc. (NYSE: SUNE) will undergo the largest bankruptcy of 2016, $10.1 billion. This easily surpasses the $6.45 billion bankruptcy of Arch Coal Inc. (OTCMKTS: ACIIQ), which filed on April 13. This year, a wealth of energy companies have collapsed due to falling energy commodity prices. The decline of oil and natural gas prices has made renewable energy like solar power less competitive.
- Shares of Tesla Motors Inc. (Nasdaq: TSLA) were off 0.5% despite news that the company has logged a stunning 400,000 orders for the new Model 3. The announcement came from CEO Elon Musk during a conference in Oslo, Norway.
- Shares of Alphabet Inc. (Nasdaq: GOOGL) are in focus as the company prepares to report quarterly earnings after the bell. The firm is expected to report per-share earnings (minus certain items) of $7.96.
- Under Armour Inc. (NYSE: UA) crushed Wall Street expectations with a huge earnings report. Shares rallied more than 7.6% after the firm reported a massive surge in sneaker sales – particularly in China. During the Baltimore-based firm's earnings call, CEO Kevin Plank praised Golden State Warriors basketball star Stephen Curry, who recently signed on with the firm and has his own sneaker line. The firm beat top-line earnings by two cents, but saw revenue surge by 30%. So, should you buy Under Armour after today's huge earnings beat? Find out here.
- The nation's fourth-largest airline company announced that profits increased by 13% in the first quarter and stated plans to retire older planes in its fleet sooner than analysts anticipated. Southwest Airlines Co. (NYSE: LUV) is cutting back on its growth strategy and reducing some level of competition against its higher-priced rivals. The company has dramatically cut into rivals' market share since expanding its operations from Dallas Love Field in late 2014.
- Microsoft Corp. (Nasdaq: MSFT) will report earnings after the market close. Analysts expect Microsoft to earn $0.64 a share, up from $0.61 in the year-ago quarter. The forecast for revenue is $22.1 billion, which would be a 1.7% increase over sales from the same period a year ago. Find out if MSFT is a buy after Q3 earnings, right here.
- Shares of Apple Inc. (Nasdaq: AAPL) fell more than 1.1% after the stock received a downgrade from Raymond James. The research firm downgraded its stock over concerns that the technology manufacturer may experience lower iPhone sales.
- In a surprise regulatory announcement, automotive giant Volkswagen AG (OTCMKTS ADR: VLKAY) reached a deal with U.S. regulators over its emission rigging scandal. After admitting that it cheated on emissions tests, the firm will purchase back more than 500,000 cars from owners. The settlement will cost billions of dollars, but it is unclear just how much the auto manufacturer plans to spend on each vehicle.
- Finally, here is your stock pick of the day. The markets are waiting for next week's FOMC meeting, set for April 26-27. And the Federal Reserve is about to get much more inflation than it bargained for in the coming weeks. Money Morning Resource Investing Specialist Peter Krauth has shared the best investment to make ahead of the April meeting. Here it is.
This Penny Stock Will Double Your Money – and Save a Dying U.S. Industry: It's not easy to find a truly compelling penny stock, which is why this one is such a remarkable find. Not only is this green energy stock capable of a gain of 100% or more, it's just now rolling out technology with the potential to rescue the struggling coal industry. But this 21st century success story has only just begun, making now the perfect time to buy this stock.
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.