Small caps holding strong
The Russell 2000 (NYSE: IWM) are holding on to their gains as a rally reversed earlier losses. At 12:31 p.m. ET, the small-cap index had added 3.12 points, or 0.46%, to 676.93. The Dow Jones Industrial Average (INDU) was up 73.35 points, or 0.60%, to 12,230.16.
Stocks small and large are in positive territory as investors are apparently riding the momentum from the U.S. Federal Reserve move on Tuesday to make up to $200 billion in expanded loans to financial institutions in an effort to ease the credit squeeze.
Small-cap stocks began rising sharply after hitting a session low at about 10:10 a.m. ET. Shortly before 11 a.m. ET the index pierced the flat line and continued gaining ground.
In economic news, the Mortgage Bankers Association reported before the start of trading that U.S. mortgage applications fell for the week ended March 7. The trade association’s index of mortgage loan application volume fell 1.9% as interest rates climbed to their highest level this year and lowered demand for home loans.
The rally is being led by companies providing printing services. Shares of small-cap consolidated Graphics, Inc. (NYSE: CGX) are in the green, as are shares of Sharonville, Ohio-based Multi-Color Corp. (Nasdaq: LABL).
Elsewhere, AudioCodes Ltd. (Nasdaq: AUDC) is bucking the trend. Shares of the Israeli maker of multimedia communications technology are down more than 5%.
“As we review our AudioCodes estimates for 2008, we see very little cause for reducing estimates, especially in the near term,” wrote Eric Kainer, an analyst with investment bank ThinkEquity Partners, in a research note today. Kainer is maintaining his “buy” rating and price target of $5 per share.
