Small caps lower midday
The Russell 2000 (NYSE: IWM) and the Dow Jones Industrial Average (INDU) are in the red due to news of poor earnings and concerns that interest rates will not fall. At 1:35 p.m. ET, the small-cap index had shed 2.78 points, or 0.34%, to 818.94. The Dow was off 40.88 points, or 0.29%, to 13,829.38.
Investors hoping for a sizeable drop in the U.S. Federal Reserve’s target interest rate may be disappointed, according to an article in The Wall Street Journal. The paper claims that policy makers, who kicked off their two-day meeting this morning, will likely either cut the federal funds rate 0.25% or leave it unchanged.
That was enough to scare away the bulls, and stocks opened in negative territory.
Contributing to the bearish mood was news that United States Steel Corp.’s (NYSE: X) third-quarter net income missed analysts’ projections by falling 35% due to costs associated with an acquisition.
Cincinnati, Ohio-based consumer goods giant The Procter & Gamble Co. (NYSE: PG) also had bad news to report, saying that its profit margin will come under pressure in the coming months due to higher energy costs.
Speaking of energy costs, the price of oil has declined $1.85 to $91.68 a barrel as investors decided to cash in on profits following Monday’s increase.
Here are the current biggest percentage gainers and losers among companies with a market cap between $100 million and $750 million:
Biggest percentage gainers:
• E-Z-EM Inc. (EZEM), up 25% on news it is being purchased for $241 million.
• Superconductor Technologies Inc. (SCON), up 16% on news of a sales agreement with a Chinese company.
• Actuate Corp. (ACTU), up 18% on news of a rise in third-quarter profit.
Biggest percentage losers:
• Smith & Wesson Holding Corp. (SWHC), down 40% on news of weak preliminary second-quarter results.
• LCA-Vision Inc. (LCAV), down 32% on news of a disappointing fourth-quarter earnings guidance.
• American Dental Partners Inc. (ADPI), down 14% on news that third-quarter profit missed Wall Street’s expectations.
