The Economy
Federal Reserve Keeps Interest Rates Unchanged
The Federal Reserve has decided to keep interest rates unchanged amidst speculations on who will become its next leader. The Fed said the decision was based on solid U.S. economic growth and a strengthening labor market. However, it is anticipated that an interest hike is still possible in December.
Trump Kills Class Action Rule Against Banks
On Wednesday afternoon, President Donald Trump officially signed a resolution that allows banks to block consumers from filing class actions. This resolution, passed under the Congressional Review Act, was aimed to lighten U.S. financial regulations. Mandatory arbitration clauses will likely remain in contracts for consumer financial services.
Oil Producers May Keep Production Cuts Throughout 2018
The OPEC countries plus Russia and nine other oil producers are considering to further extend the current production cut of 1.8 million barrels per day throughout the entire year of 2018. Currently, the production cut runs until March 2018.
The Markets
S&P, Dow Go Up As Basic Materials Sector Rallies
The S&P 500 and Dow went higher on Wednesday thanks to a rally in the basic materials sector, led by United States Steel Corp. (NYSE:$X), whose latest earnings results beat expectations. Other household names in the sector such as BHP Billiton Ltd. (NYSE:$BHP) and Rio Tinto plc (NYSE:$RIO) also saw gains.
Also, all three indices hit intraday record highs earlier today, due in large part to the positive earnings results released so far, though the Nasdaq eventually fell, limited by a dip in Apple Inc. (NASDAQ:$AAPL)’s stock.
Bitcoin Reaches New Record High
Bitcoin climbed to a new all-time high of $6,450 on Wednesday following an announcement by CME Group Inc. (NASDAQ:$CME), which operates the world’s largest options and futures exchange, that it plans to launch bitcoin futures in Q4 2017.
Top Active Stocks
As mentioned, the basic materials industry helped to send the markets higher on Wednesday, led by a 7.8% gain from United States Steel Corp. (NYSE:$X). In contrast, AK Steel Holding Corp. (NYSE:$AKS), another steel company, fell by over 4% following its Q3 earnings miss.
In the healthcare sector, Envision Healthcare Corp. (NYSE:$EVHC)’s shares plunged (down 34.2% at market close) to its yearly low, as investors were left disappointed by its results for the third quarter. The company posted earnings per share of $0.73 for the quarter, far below the consensus estimate of $0.88.
General Electric Co. (NYSE:$GE) continued its decline, now trading at a level near the August 2015 flash crash. The company’s shares are down by 36% for the year and is the worst-performing component of the Dow Jones. This decline may well continue, as multiple analysts have slashed the stock’s price target.
Another struggling company making headlines this week is Under Armour (NYSE:$UA), whose stock has lost over half its value during the year. Following the disheartening results posted in the third quarter, its share price fell by 22% in one day, and the stock was downgraded by a large number of Wall Street analysts.
On the other hand, Intel Corp. (NASDAQ:$INTC)’s stock price has increased to a 17-year high, now at $46.71 a share. The semiconductor company saw a promising third quarter, easily beating estimates, and its shares continued to soar following the earnings release as the stock was handed multiple price target upgrades.
Featured image: Depositphotos/ igorgolovniov
