Russell 2000 stays positive
The Russell 2000 (NYSE:IWM) is holding on to its gains after a brief decline.
At 11:23 a.m. ET, the small-cap index had added 2.32 points, or 0.34%, to 685.50. The Dow Jones Industrial Average was up 15.47 points, or 0.13%, to 12,231.87.
Small-cap stocks are posting modest gains as investors digest the latest economic news and make sense of the Bush administration’s plan to overhaul financial regulation.
The National Association of Purchasing Management-Chicago reported after the start of trading that its purchasing managers’ index rose to a level of 48.2 in March from 44.5 in February. The increase is more than economists were expecting but still shows a contraction.
Production, employment and new orders increased, easing concerns of a decline in business investment.
The Russell 2000 fell as soon as the numbers were announced, slipping below the flat line at about 10:30 a.m. ET before rebounding.
Investors are also analyzing the Bush administration’s plan to reform financial regulation. The proposal, outlined by U.S. Treasury Secretary Henry Paulson after the opening, would give the U.S. Federal Reserve increased power over large non-bank financial firms and set minimum licensing standards for mortgage brokers currently operating outside federal regulations.
Shares of companies offering school services are currently the best performing industry group. Among them is small-cap Corinthian Colleges, Inc. (Nasdaq:COCO), which operates schools in the United States and Canada.
Similarly, Charles Town, W.Va.-based online postsecondary education provider American Public Education, Inc. (Nasdaq:APEI) is also seeing its stock appreciate.
On the flip side, drugmakers are the worst performing industry group. Among the losers is Enzon Pharmaceuticals, Inc. (Nasdaq:ENZN), which makes drugs for patients with cancer and other life-threatening conditions.
