Dow Jones Industrial Average Today Rallies As Earnings Reports Bolster Optimism For 2016

The Dow Jones Industrial Average surged on Tuesday afternoon thanks to another round of positive earnings reports and increased expectations that markets will continue to rally after the U.S. election.

Healthcare stocks rallied thanks to a 7% surge in UnitedHealth Group Inc. (NYSE: UNH), which reported strong quarterly results.

Let's look at the final numbers on Tuesday for the DowS&P 500, and Nasdaq: 

Dow Jones: 18,161.94; 75.54; 0.42%

S&P 500: 2,139.60; 13.10; 0.62%

Nasdaq: 5,243.84; 44.01; 0.85%

Now, here's a look at today's most important market events and stocks, plus a preview of Tuesday's economic calendar.

DJIA Today: Markets Rally After Surge in Healthcare Stocks; Oil Prices Flat

The Dow Jones rallied 75 points on Tuesday as investors weighed positive earnings results and speculated on the timing of the next interest rate hike. The S&P 500 and the Nasdaq had their best week in a month due to increased optimism on this quarter's earnings expectations.

Life is getting more expensive in the United States. In September, the U.S. Consumer Price Index (CPI) increased at the fastest pace in five months. The news has many economists anticipating that inflation levels are approaching the Federal Reserve's target goal. According to CME FedWatch, the probability of a rate hike in December currently sits north of 60%.

Meanwhile, investors continue to monitor the financial sector after Goldman Sachs Group Inc. (NYSE: GS) reported a 58% jump in trading revenue last quarter. The investment bank reported earnings per share (EPS) of $4.88 on top of $8.17 billion in revenue. Wall Street analysts expected an EPS of $3.86 on top of $7.57 billion in revenue. While everyone is high-fiving about the financial sector's strong performance in recent months, another big story is brewing that everyone seems to have ignored. There is a crisis developing in the consumer debt markets… and it all comes back to one terrible phrase from the 2009 financial crisis: subprime lending.

The price of crude oil today gained as a rising dollar offset optimism regarding production cuts proposed by the Organization of the Petroleum Exporting Countries (OPEC).

This morning, OPEC energy chief Mohammad Barkindo said he will meet with Russia to discuss global oil production limits and efforts to support crude prices. Russia, a non-member of OPEC, is the world's second-largest crude producer and has been hammered by the low oil price environment. Bolstering prices would be an important step to help the country stabilize its economy.

The WTI crude oil price today added 0.9%, while the Brent crude oil price gained 0.5%.

But the big story today was the new discoveries inside the hacked emails of Hillary Clinton's campaign.

According to the latest leak, emails from campaign chair John Podesta indicate that Clinton was considering Apple Inc. (Nasdaq: AAPL) CEO Tim Cook as a potential candidate for Vice President. Other names pitched by Podesta include Microsoft Corp. (Nasdaq: MSFT) co-founder Bill Gates; Coca-Cola Co. (NYSE: KO) CEO Muhtar Kent; Starbucks Corp. (Nasdaq: SBUX) CEO Howard Schultz; and former New York mayor Michael Bloomberg.

Clinton ultimately chose Sen. Tim Kaine (D-VA). The revelation is an interesting plot twist in the 2016 election year and offers a glimpse into Clinton's business connections.

Top Stock Market News Today, Oct. 18, 2016

  • On the earnings front, shares of Netflix Inc. (Nasdaq: NFLX) surged more than 19% after the streaming giant reported a huge boost in subscriber growth and crushed quarterly earnings expectations. Earlier this week, we explained that we have been bullish about NFLX stock for a long time.
  • Meanwhile, shares of Yahoo! Inc. (Nasdaq: YHOO) added 0.5% as the technology company prepares to report quarterly earnings after the bell. The firm has been under significant pressure following the news that it suffered one of the largest cyber breaches in global history. The damage to the firm's brand was so bad that Verizon Communications Inc. (NYSE: VZ) is seeking to renegotiate terms of its planned purchase of Yahoo's core internet business.

Disclosure: None.

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Chee Hin Teh 7 years ago Member's comment

Thanks for sharing