The stock markets in the United States ended the trading with another rally today propelled by the minutes of the meeting of the Federal Reserve alleviating investors’ concerns regarding its timetable in increasing the interest rate in the future.
The minutes of the meeting of the Federal Reserve last March 18-19 indicated that policy makers were concerned that an increased in the interest rate guidance could result in an earlier than expected interest rate hike, and they struggled to convey that the rates will remain very low for a certain period.
Policy makers agreed on an open-ended approach wherein short-term rates will remain unusually low for a time even after employment and inflation situation are almost returned to a normal level because the economy is not yet totally healthy.
Investors considered the Fed’s minutes an assurance that the interest rate will not increase sooner than the market expected.
In a phone interview with Bloomberg, Jeffrey Kleintop, market strategist at LPL Financial LLC commented, “These minutes are calming for the markets. It was clearly stated that the projections overstated the likely shift in rates. A slower pace of interest rates seems more likely here than from the statements.”
Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi said, “Don’t look for early or very many rate hikes any time soon.”
U.S. Markets
- Dow Jones Industrial Average (DJIA)- 16,437.18 (+1.11%)
- S&P 500- 1,872.18 (+1.09 %)
- NASDAQ- 4,183.90 (+1.72%)
- Russell 2000- 1,159.96 (+1.37%)
European Markets
- EURO STOXX 50 Price EUR- 3,182.79 (+0.16%)
- FTSE 100 Index- 6,635.61 (+0.69%)
- Deutsche Borse AG German Stock Index DAX- 9,506.35 (+0.16%)
Asia Pacific Markets
- Nikkei 225- 14,299.69 (-2.10%)
- Hong Kong Hang Seng Index- 22,843.17 (+1.09%)
- Shanghai Shenzhen CSI 300 Index- 2,238.62 (+0.06%)
Stocks in Focus
The stock price of Alcoa Inc (NYSE:AA) climbed nearly 4% to $12.99 per share after the aluminum giant reported adjusted earnings of $0.09 per share that beat the $0.05 adjusted earnings per share estimated by Wall Street analysts. The company also projected that the global aluminum demand will be strong this year.
Facebook Inc (NASDAQ:FB) gained more than 7% to $62.41 per share today, its highest gain since January 30. Over the past three months, shares of the social network giant rose 9% and 14% year-to-date. The latest report from J.P. Morgan analysts Doug Anmuth helped lift the stock as he noted that the company is still in the early stages of monetizing its 1.2 billion users worldwide. He also said that the recent selloff in technology stocks including Facebook “created some attractive opportunities in companies with continued strong fundamentals and growth potential ahead.”
The shares of Regeneron Pharmaceuticals Inc (NASDAQ:REGN) increased almost 7% to $306.26 per share. Regeneron and its partner Sanofi SA (NYSE:SNY) revealed that their experimental PCSK9 inhibitor, alirocumab, significantly lowered “bad” cholesterol in Japanese patients.
