After Market: Fed’s Low Interest Plans Boost Investors’ Moods

Date: Apr 09 2014

Filed under: Earnings, Market News, Federal Reserve, Interest Rates, Investing

Back-to-back rising days on Wall Street eased worries after the big sell-off that began last week. Buyers Wednesday hit the accelerator after the release of minutes from the last Fed policy meeting reassured investors that interest rates will stay low for some time to come.

The Dow Jones industrial average (^DJI) rallied 181 points, the Nasdaq composite (^IXIC) jumped 71 and the Standard & Poor’s 500 index (^GPSC) gained 20 points.

Facebook (FB) led the rally, jumping 7 percent on positive comments from several brokerage firms. However, Facebook shares are still down 14 percent over the past month. LinkedIn (LNKD) gained 4 percent. It also received a brokerage upgrade. Amazon (AMZN), Netflix (NFLX) and other Internet stocks also posted gains.

Biotechs also had a good day. Celgene rose 6½ percent. Biogen (BIIB), Regeneron (REGN), Isis (ISIS) and Alnylam (ALNY) all gained at least 5 percent. And Ultragenyx Pharmaceuticals (RARE) jumped 12 percent as Morgan Stanley gave the stock an “overweight” rating.

And the gun has sounded on the first-quarter earnings season. Alcoa (AA) rose nearly 4 percent as it beat expectations. That helped some other old-line industrials: US Steel (X) rose 2½ percent and Allegheny Technologies (ATI) gained 3½ percent. But WD-40 (WDFC) slid 6 percent as net fell from a year ago.

And automakers hit some potholes. Toyota (TM) fell more than 1 percent after recalling 6.4 million cars worldwide for airbag and seat rail problems. GM (GM) fell 2½ percent as Morgan Stanley lowered its rating on the stock to “underweight.” Ford (F) went along for the downhill ride, losing 1½ percent.

Elsewhere, Intuitive Surgical (INTU) dropped 7 percent after warning that revenue will be weaker than expected. It’s also taking a charge to settle legal claims.

But Comcast (CMCSA) rose 2 percent and Time Warner Cable (TWC) gained 1½ percent as executives from the two companies testified before a Senate committee about the consumer benefits of their planned merger.

Constant Contact (CTCT) jumped 29 percent. The online marketing firm raised its earnings outlook.

And La Quinta (LQ), the hotel chain, edged 3 percent above its IPO price of $17 a share. However, the stock was priced below Street expectations.

What to Watch Thursday:

  • Selected chain retailers release March sales comparisons.
  • The Labor Department issues two reports at 8:30 a.m. Eastern time: import and export prices for March, and weekly jobless claims.
  • Freddie Mac releases weekly mortgage rates at 10 a.m.
  • The Treasury Department releases its federal budget for March at 2 p.m.

These major companies are scheduled to release quarterly financial statements:

  • Family Dollar Stores (FDO)
  • Pier 1 Imports (PIR)
  • Rite Aid (RAD)

–Produced by Drew Trachtenberg.

 

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