Russell 2000 moving higher
The Russell 2000 (NYSE: IWM) is posting gains as investors hold their breath ahead of the U.S. Federal Reserve’s decision on interest rates. At 2:01 p.m. ET, the small-cap index was up 3.81 points, or 0.48%, to 795.01.The Dow Jones Industrial Average (INDU) had added 33.09 points, or 0.24%, to 13,760.12.
Stocks are in positive territory as investors wait for the Fed to announce its decision on monetary policy. Financial markets are expecting to see the federal funds rate lowered at least 0.25%. More bullish voices are calling for a decline of 0.50% or even 0.75%.
The U.S. central bank’s target interest rate now stands at 4.5%. In its latest two meetings, the Fed lowered the rate a cumulative 0.75% in order to help the U.S. economy get through a rough patch caused by declining home prices and the financial aftershocks of the subprime mortgage meltdown.
“The U.S. economy is now in the danger zone,” says a report released today by forecasting company Global Insight. The Boston, Mass.-based firm’s “Top-10 Economic Predictions for 2008” shows the U.S. economy showing no growth in the last quarter of 2007 and weak growth during the first six months of 2008.
The report forecasts that the U.S. economy will grow no more than 1.9% in 2008, which means that the year will be the slowest since 2002, when gross domestic product expanded a lackluster 1.6% due to the burst of the tech bubble and the 9/11 attacks. This time the economy will be dragged down by housing and a decline in consumer spending growth.
Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:
Biggest percentage gainers:
• Genesis Microchip Inc. (GNSS), up 57% on news it is being purchased by STMicroelectronics NV (STM) for about $336 million.
• Cost Plus, Inc. (CPWM), up 22%.
• Smith Micro Software, Inc. (SMSI), up 20% on news it will buy part of Pctel Inc. (PCTI) for $59.7 million.
Biggest percentage losers:
• NCI Building Systems, Inc. (NCS), down 16% on news of a decline in fiscal fourth-quarter profit.
• Cowen Group, Inc. (COWN) down 12% on news of an increase in the ratio of compensation and benefits expense to revenue.
• Cardica Inc. (CRDC), down 9% following news on Tuesday of a partial exercise of the over-allotment option granted to the underwriters of its public offering.
