Small caps climb higher
The Russell 2000 (NYSE: IWM) and the other major U.S. indices have recovered from a morning dip and are now posting gains. At 1:58 p.m. ET, the small-cap index was up 4.10 points, or 0.57%, to 725.70. The Dow Jones Industrial Average (INDU) had added 8.29 points, or 0.06%, to 12,808.47.
Small-cap stocks are moving up as speculation of an upcoming interest rate cut encourages investors to snap up equities following Friday’s steep declines. The major U.S. indices were trending higher in the morning, with the exception of a brief fall shortly after 10 a.m. ET.
News of a worse-than-expected jobs report on Friday dropped stocks and heightened speculation that the U.S. Federal Reserve will cut interest rates to prevent the economy from slipping into recession. The Fed is scheduled to begin a two-day meeting on Jan. 29.
Economists generally agree that U.S. economic growth was slow in the fourth quarter of 2007, dragged down by the stagnating U.S. housing sector and tighter lending.
Observers will be listening to a speech by the U.S. Treasury secretary at 2 p.m. ET about measures the Bush administration plans on taking to give the economy a boost.
Elsewhere, the price of oil has declined $3.05 to $94.86 a barrel due to lower heating demand in the United States as unseasonably warm weather sweeps large parts of the country.
Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:
Biggest percentage gainers:
• Emergent BioSolutions Inc. (EBS), up 38% on news that it announced better-than-expected preliminary 2007 results.
• InterMune Inc. (ITMN), up 27% on news that a clinical trial of a drug for Hepatitis C achieved its goal.
• Pharmasset Inc. (VRUS), up 27% on news that a study of a drug for Hepatitis C achieved favorable results.
Biggest percentage losers:
• ShoreTel Inc. (SHOR), down 51% on news it lowered its fiscal second-quarter revenue guidance.
• Interactive Intelligence Inc. (ININ), down 16%.
• The Aristotle Corp. (ARTL), down 15%.
