The stock markets in the United States declined after the Federal Reserve issued a statement that led investors to speculate that it might taper its quantitative easing the over the next several months. As expected, policymakers maintained the $85 billion bond-buying program.
Investors noted that the Federal Reserve changed the sentence from its previous statement indicating that tighter financial conditions might slow the improvement in the economy. Fed policymakers wrote that fiscal policy is “restraining economic growth.” Policymakers also noted that the growth of the housing sector slowed in recent months.
Chris Gaffney, senior market strategist at Everbank Wealth Management, told Bloomberg, “When you look at the reaction, investors are really taking the opinion that the taper may actually come sooner than previously thought.” He added that the statement of the Fed showed that they continue to believe that economy will grow. Their view remains positive. He projected that the Fed will start tapering its stimulus before March.
Economists surveyed by Bloomberg projected that the Federal Reserve will keep its current level of stimulus until March next year.
- Dow Jones Industrial Average (DJIA)- 15, 618.64 (-0.39%)
- S&P 500- 1,763.31 (-0.49%)
- NASDAQ- 3,930.62 (-0.55%)
- Russell 2000- 1,108.04 (-1.24%)
- EURO STOXX 50 Price EUR- 3,040.69 (-0.33%)
- FTSE 100 Index- 6,777.70 (+0.04%)
- Deutsche Borse AG German Stock Index DAX- 9,010.27 (-0.13%)
Asia Pacific Markets
- Nikkei 225- 14,502.35 (+1.23%)
- Hong Kong Hang Seng Index- 23,304.02 (+2.00%)
- Shanghai Shenzhen CSI 300 Index- 2, 407.47 (+1.49%)
Stocks in Focus
The stock price of Big 5 Sporting Goods Corporation (NASDAQ:BGFV) gained 15.54% to $19.40 per share today. The company posted $0.45 adjusted earnings per share for the third quarter, up by 15.4% from its earnings in the same period a year earlier. Including one-time charges, the company earned $0.41 per share. Big 5 Sporting Goods reported $259.1 million net revenue for the period.
NuVasive, Inc. (NASDAQ:NUVA) increased by 22.33% to $31.39 per share after the company raised its guidance for the full year 2013. During the third quarter, the company generated $0.39 earnings per share on $169.2 million revenue, higher than the consensus estimate of $0.24 earnings per share on $158.48 million revenue. The company estimated that it will be able to deliver $1.41 earnings per share and around $700 million revenue for the entire year.
On the other hand, the stock value of DreamWorks Animation SKG Inc (NASDAQ:DWA) surged by 17.36% to $32.65 per share despite reporting a 59% decline in profit. During the third quarter, the company achieved $0.12 earnings per share compared with its $0.29 profit in the same period a year earlier. According to Jeffrey Katzenberg, the digital download sales of DreamWorks improved.