Russell 2000 higher thanks to IBM
The Russell 2000 (NYSE: IWM) is rising on news of a stock buyback program by International Business Machines Corp. (Nasdaq: IBM) and despite poor economic reports.
At 11:56 a.m. ET, the small-cap index was up 9.01 points, or 1.27%, to 719.47. The Dow Jones Industrial Average (INDU) was down 84.34 points, or 0.67%, to 12,654.56.
Small-cap stocks moved into positive territory immediately after IBM announced at around 11 a.m. ET that its board has authorized a $15 billion share buyback program that could boost 2008 earnings per share.
Trading has been volatile this morning, with most of the major U.S. indices generally staying below the flat line on news of economic reports that point to inflation and dispirited consumers.
The U.S. Labor Department reported before the opening that producer prices increased 1% in January, more than the expected 0.4%.
After the opening the Conference Board announced that its index of consumer confidence fell to a five-year low of 75.0 in February, down from 87.3 in January. Economists were expecting a more modest decline.
Among the biggest small-cap winners is China TechFaith Wireless Communication Technology Ltd. (Nasdaq: CNTF), which announced after the close on Monday that it swung to a fourth-quarter net income and outpaced analysts’ projections.
Similarly, dredging services provider Great Lakes Dredge & Dock Corp. (Nasdaq: GLDD) posted fourth-quarter revenue above what Wall Street was projecting.
Revenue for the three months ended Dec. 31, 2007 was $156.9 million, up 28% from $121.8 million a year earlier. Analysts had forecasted $130.6 million.
Meanwhile, shares of 012 Smile.Communications Ltd. (Nasdaq: SMLC), an Israeli provider of communications services, are flat despite news that revenues jumped 147% in the fourth quarter of 2007.
