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The Dow Jones Industrial Average was back on the rise this afternoon, fueled by a strong performance by telecom stocks.
Despite a lackluster earnings report from global conglomerate General Electric Co. (NYSE: GE), the markets experienced their fourth straight positive week.
The Dow has come a long way since British voters decided to depart the European Union, a catalyst that sent the index off more than 800 points in two sessions. Since then, record low interest rates and falling bond prices have pushed investors into the markets. As our Capital Wave Strategist Shah Gilani explains, the S&P 500 is trading at nosebleed valuations.
Today was another wild day on Wall Street, and investors might have missed several profit opportunities if they weren't paying attention. We'll get to them in a moment.
First, check out the results for the Dow Jones, S&P 500, and Nasdaq:
Dow Jones: 18,570.85; +53.62; +0.29%
S&P 500: 2,175.03; +9.86; +0.46%
Nasdaq: 5,100.16; +26.26; +0.52%
Now, here's the top stock market news today… and your best ways to profit.
DJIA Today: Dow Rallies Despite Another Down Day for Crude Oil
The Dow Jones added over 53 points today, pushing the markets back toward record territory.
The markets remained resilient despite a mass shooting in Munich, Germany. An armed assailant opened fire in a mall in Germany's third most populated city. Details about the shooter have not been released. However, the violence is a reminder that war, terrorism, and ugliness are serious problems that are not going away for the global markets. Unfortunately, it's becoming a growth industry. Money Morning Chief Investment Strategist Keith Fitz-Gerald offers his insight on what this trend means for the markets.
Traders have largely forgotten that the U.S. Federal Reserve will meet next week to discuss monetary policy. Fed officials say they want to hike interest rates two more times this year. However, the markets see very low odds over the next six months of such an event. In fact, Morgan Stanley (NYSE: MS) doesn't expect a rate hike until 2018. The Fed being unable to raise rates is just one of the reasons we could still see a stock market crash this year.
It was a mixed day for airline stocks after Southwest Airlines Co. (NYSE: LUV) reported a weak outlook on Thursday. Shares of American Airlines Group Inc. (NYSE: AAL) beat Wall Street top and bottom line expectations. However, the iconic airline plunged 44% from the same period last year. Shares of LUV stock were up 1.2% on the day despite news that the company received a downgrade from Buckingham Research.
Gold prices and silver prices both declined this afternoon as markets kept pushing toward record highs. Gold and silver both dipped 0.6%. That said, we're still seeing double-digit gains for silver this year. Go here for our latest silver price forecast for 2016.
Oil prices slid on Friday as traders worried about a potential glut fueled by increased Iraqi exports. WTI crude was off 1.2%, while Brent crude slipped 1.3%. This afternoon, Baker Hughes Inc. (NYSE: BHI) reported that the U.S. rig count increased for the fourth consecutive week. This week, the nation saw 14 rigs added, bringing the country to 371 rigs.
While many believe that WTI crude is on its way to $40 in the short term, a growing consensus expects oil prices to push much higher this year. That consensus echoes the insight of our Global Energy Strategist Dr. Kent Moors. As Kent explains, this slight downturn is creating a terrific medium-term profit opportunity for savvy investors who start setting their positions right now. Click here for Kent's insight.
Now, let's look at the day's biggest stock movers and the best investment strategy for biotech stocks.
Top Stock Market News Today
- AT&T Corp. (NYSE: T) was up 1.5% after the global telecom giant reported earnings. The stock is back near a 52-week high despite news that it is seeing more cord-cutting in its television unit.
- Meanwhile, Verizon Communications (NYSE: VZ) stock added 1% on the day. The company is now considered the front-runner to win the auction for the core business of Yahoo! Inc. (Nasdaq: YHOO). The deal would give Verizon direct access to Yahoo's advertising technologies, complementing its $4.4 billion buy of AOL last year. YHOO stock added more than 1% on the news. Reuters reports that it is unlikely that Yahoo CEO Marissa Mayer would join the company.
- Shares of Pandora Inc. (NYSE: P) were up 2% on news the firm rejected a $3.4 billion buyout offer from Sirius XM Holdings Inc. (Nasdaq: SIRI). The Wall Street Journal reported news of the offer last night. Pandora also announced that its listener base was off more than 1.3 million users from last quarter, raising new concerns about the company's business model.
- Shares of Chipotle Mexican Grill Inc. (NYSE: CMG) were up more than 5.7% despite news that the company fell short of Wall Street earnings expectation. The casual dining giant remains under significant pressure after last year's public health scare involving E. coli. The company said that same-store sales were off 23%, the latest sign that the firm has struggled to win back customers. Despite today's gain, CMG stock is still off more than 40% on the year. And, as we explain, there's still a lot more pain on the way.
- Finally, here's your investment of the day. Shares of biotech firm Relypsa Inc. (Nasdaq: RLYP) rallied more than 58% on Thursday. Why the surge? News just broke that the biotech company will be purchased by Galenica AG (VTX: GALN) for $1.58 billion in cash. Huge gains in the biotech sector like this are a challenge to find, but there's a strategy that we've prepared for our investors. As we explain, investing in biotech stocks comes with increased exposure to market volatility. Here's our advice on how to profit from biotech stocks.
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.