Small caps rising
The Russell 2000 (NYSE:IWM) is in positive territory as investors await details of the Bush administration’s plan to overhaul financial regulation.
At 10:05 a.m. ET, the small-cap index had added 2.20 points, or 0.32%, to 685.38. The Dow Jones Industrial Average (INDU) was up 3.83 points, or 0.03%, to 12,220.23.
Small-cap stocks seesawed in the opening minutes before heading higher as investors wait for news about sweeping changes in financial regulations proposed by the Bush administration. Treasury Secretary Henry Paulson is expected to make a speech at 10 a.m. ET outlining the plan.
Information released prior to the official announcement suggests that the proposal will give the U.S. Federal Reserve increased power over financial institutions. Many observers blame the subprime mortgage mess on lax oversight.
With stocks rising, shares of small-cap Cougar Biotechnology, Inc. (Nasdaq:CGRB) are among the winners. The Los Angeles-based biopharmaceutical company reported before the opening that its fourth-quarter loss was narrower than expected.
Similarly, Gilat Satellite Networks Ltd. (Nasdaq:GILT), which provides Internet Protocol-based digital satellite communication and networking products and services, is seeing its stock rise on news before the opening that it will be acquired by a consortium of private equity investors for about $475 million.
