Mixed closes after rate report
The Russell 2000 eked out a gain but the Dow slipped following news that the U.S. Federal Reserve has decided to leave interest rates unchanged. The Russell 2000 added 0.57 points, or 0.07%, to finish at 839.03. The Dow Jones Industrial Average lost 5.45 points, or 0.04%, to 13,422.28.
The federal funds rate will remain at 5.25%, the U.S. Federal Reserve announced this afternoon. The central bank also reiterated that its “predominant” policy concern is that inflation will not moderate as expected.
The dominant news before the Fed’s decision came out was that U.S. economic growth for the first quarter was revised up to 0.7%, but still came in below expectations. Economists were forecasting gross domestic product to grow by 0.8%. The Commerce Department had previously estimated that economic growth during the first three months of 2007 was 0.6%.
Elsewhere, jobless claims for the week ended June 23 fell 13,000 to 313,000 on a seasonally-adjusted basis, according to the Labor Department. That outpaced expectations of a decline of 9,000.
Among specific small-cap companies:
Shares of Comverge Inc. (Nasdaq: COMV) ended the day on an upbeat note following news that the maker of energy-saving equipment will acquire 100% of rival Enerwise Global Technologies for $75.7 million. The deal has been approved by both boards and is scheduled to close in July, East Hanover, N.J.-based Comverge said after Wednesday’s close. The combined company will be the largest American provider of demand response and energy management solutions. Shares added $1.76, or 6%, to close at $30.01.
Euro Tech Holdings Company Ltd. (Nasdaq: CLWT) lowered its profit in fiscal 2006. The net income for the 12 months ended Dec. 31 fell to $0.36 million, down 51% from net income of $0.73 million in fiscal year 2005, the company, which is headquarter in Hong Kong, announced before the opening bell. That translates to earnings of $0.04 per share, compared with $0.11 per share a year earlier. The chairman and CEO attributed the decline to restructuring and a controlled expansion, and said the results were expected. Euro Tech Holdings distributes water treatment equipment. The stock fell $0.49, or 18%, to stop at $2.28.
Shares of Elmsford, N.Y.-based BioScrip Inc. (Nasdaq: BIOS) added $0.42, or 10%, to close at $4.82, following news of an analyst’s upgrade. Investment bank Piper Jaffray raised its rating for the pharmaceutical company’s stock to “Outperform” from “Market Perform” based on the expectation that it will be profitable in the third quarter, according to a research note before the start of trading.
