The stock markets in the United States plummeted due to speculations that the Federal Reserve is remained on the path to increasing the interest rates this year. The markets were also negatively impacted by weakness of equities in the energy sector.
Early this month, Cleveland Federal Reserve Bank President, Loretta Mester suggested that the central bank would likely raise interest rates in the first half of 2015. She believed that the United States will have “pretty good economy” this year and she considered the declining oil prices a “tailwind.”
DG Value Adds 23.7% In 2020, Plans New SPAC Fund
Dov Gertzulin's DG Value Funds returned approximately 19.2% in the quarter ending December 31, 2020, according to a copy of the hedge fund's full-year 2020 letter to investors, a copy of which ValueWalk has been able to review. Following the fourth-quarter performance, DG's flagship value strategy ended 2020 with a positive return of 23.7%. That Read More
Today, the Federal Reserve Open Markets Committee (FOMC) commented that the U.S. economic growth is solid in December.
Policy makers also described the labor market as strong and anticipated that the inflation rate would decline further in the near-term, but likely to increase gradually to its 2% target over the medium term.
The Fed also reiterated that it would remain patient when it comes to the timing of the implementation interest rate hike.
BNP Paribas economist Laura Rosner told Bloomberg, “The fed’s decision about the timing of liftoff is not as sensitive to low inflations as before. “Inflation is one of many factors that will be considered in deciding when to raise rates. The inflation undershoot is no longer receiving special emphasis.”
On the other hand, Anthony Valeri, a market strategist at LPL Financial commented that the statement of the Fed was “slightly hawkish.” According to him, the equity markets perceived “a June hike still being a potential outcome.”
“It’s basically interpreting that the Fed will plow ahead with rate hikes despite low inflation and international woes,” said Valeri.
- Dow Jones Industrial Average (DJIA) – 17,193.88 (-1.11%)
- S&P 500- 2,002.35 (-1.34%)
- NASDAQ- 4,637.99 (-0.93%)
- Russell 2000- 1,172.90 (-1.82%)
- EURO STOXX 50 Price EUR- 3,358.96 (-0.40%)
- FTSE 100 Index- 6,825.94 (+0.21%)
- Deutsche Borse AG German Stock Index DAX- 10,710.97 (-0.78%)
- Nikkei 225- 17,795.73 (+0.15%)
- Hong Kong Hang Seng Index- 24,861.81 (+0.22%)
- Shanghai Shenzhen CSI 300 Index- 3,525.32 (-1.39%)
Stocks in Focus
The shares of Apple closed $115.31 per share, up by more than 5%. In fact, the stock went up as much as $118.12 per share today. Investors are bullish following its record-breaking financial results. According to the S&P, Apple set a new world-record for the most profitable quarter in the history of any company. Its $18 billion net profit exceeded the $15.9 billion net profit recorded by Exxon Mobil in 2012.
The stock price of BlackBerry declined more than 4% to $10.12 per share today. It had been reported that the interest of developers on the company’s mobile platform reached an all-time low.
Boeing gained more than 5% to $139.64 per share after reporting better-than expected quarterly earnings. The company posted $2.31 in earnings per share on $24.47 billion in revenue for the fourth quarter compared with the $2.10 in earnings per share on $23.93 billion in revenue estimated by analysts.