U.S. Stocks Close Lower as Feds Hike Interest Rate
As anticipated, the Federal Reserve raised interest rates by 25 basis points on Wednesday. U.S. stocks nursed earlier gains only to give way and abruptly close lower.
All three main benchmarks lost with the Dow Jones Industrial Average falling 106.93 points (-0.40%) to finish at 26,385.28. The S&P 500 Index shed 9.59 points (-0.33%) while the Nasdaq Composite Index dropped by 17.11 points or a -0.21% loss.
The members of the Federal Open Market Committee (FOMC) voted unanimously voted to increase the benchmark interest rate to a range of 2% to 2.25% and intimated another hike by December.
They also predict three more rate increases in 2019. The mid-week move by the Feds signals the tightening of monetary policy and doing away of the “accommodative” stance.
AT&T Gets Support from Attorney Generals
The U.S. Justice Department is appealing U.S. District Judge Richard Leon’s decision last June allowing AT&T Inc. (T) to acquire Time Warner. The U.S. government wants the federal appeals court to reverse its ruling. But a group of attorney generals from nine states is backing AT&T.
The nine state officials said in a court filing, “It is rare for the federal government to pursue an antitrust case involving major, national companies without any state joining the effort.” In this case, no states have filed briefs in support of the Justice Department’s appeal.
The nine attorney generals are from Alabama, Georgia, Kentucky, Louisiana, New Mexico, Oklahoma, South Carolina, Utah and Wisconsin.
Comcast Gains 51% Control of U.K.’s Sky
Comcast Corp. (CMCSA) ends its buying of the shares of European broadcaster Sky after securing 38% the stock. The company will gain 51% control of Sky after Rupert Murdoch’s Twenty-First Century Fox (FOX A) said on Wednesday they are selling their 39% stake in Sky to Comcast.
The U.S. cable company beat FOX along with its supporter Walt Disney Co. (DIS) in the long-running battle for the pay-TV. Comcast won via a rare auction held last weekend. The entertainment giant Disney would have been Sky’s ultimate owner since it bought most of Fox’s film and TV assets for $71 billion in a separate deal.
SurveyMonkey Makes Sterling Debut at Wall Street
SVMK Inc. (SVMK) or SurveyMonkey made a grand debut on Wednesday. The shares of the software and online survey company surged 42% to end at $17. The company had set its IPO price at $12 late Tuesday night. SVMK touched a high of $20 during trading. Investors’ reception to SurveyMonkey was similar to the IPO of Eventbrite Inc.’s (EB) last September 20.
The software company offers digital survey and data analytics services for enterprise and personal use. CEO Zander Lurie told CNBC’s “Squawk Box that the company, on a daily basis, handles more than 20 million answers from over 3 million people. He added that SurveyMonkey also pays “great heed” to consumer privacy.
Bezos’ Blue Origin Secures Contract as Engine Supplier
The space startup Blue Origin LLC of AmaZon.com Inc.’s (AMZN) founder Jeff Bezos is now an engine supplier. The Wall Street Journal reported on Thursday that Blue Origin has won a contract to supply engines for United Launch Alliance LLC (ULA).
ULA is the rocket joint venture of Boeing Co. (BA) and Lockheed Martin Corp. (LMT). They will formally announce today that it has chosen Blue Origin’s BE-4 engine for its Vulcan rocket.