News of the Day

  • U.S. stocks soar as Fed’s ‘patience’ fuels rally

    The U.S. stock market rallied on Thursday, a day after the Federal Reserve said it “can be patient” about the timing of its first rate hike, signalling increases will be slow and steady.The FOMC statement following its two-day policy setting meeting sent indexes soaring on Wednesday, with the S&P 500 scoring its biggest one-day gain of the year. Indexes appear to be building on those gains, with one of the strongest opening gains this year.Why the Fed tries to be firm and flexible at the same time the S&P 500 SPX, +1.31% rallied, with gains across the board. Technology and energy sectors were leading the move higher. The Dow Jones Industrial Average DJIA, +1.30% jumped more than 200 points, with all 30 of its components trading up.

  • Fed Sets Stage for Rate Hikes in 2015

    The Federal Reserve took a delicate step toward raising short-term interest rates in 2015, but at the same time exposed its skittishness about signaling a historic move away from easy-money policies in place since the global financial crisis.In a statement Wednesday after a two-day policy meeting, the Fed broached the prospect of “beginning to normalize the stance of monetary policy,” the most direct formal reference to raising rates it has made in years. Rates have been held near zero since December 2008 and since then the Fed has offered assurances that they would stay low amid low inflation and elevated levels of unemployment. The new statement said the Fed would be “patient” before raising rates, adding that the overall outlook hadn’t much changed from earlier assurances that rates would stay low for a “considerable time.”

  • Jobless claims still signal strong U.S. hiring

    The number of people who applied for new unemployment benefits in mid-December remained below 300,000, a level typically associated with strong hiring.Initial jobless claims fell by 6,000 to a seasonally adjusted 289,000 in the seven days ended Dec. 13, the Labor Department said Thursday. New applications for jobless benefits have tallied less than 300,000 in 13 of the past 14 weeks.The average of new claims over the past month, meanwhile, slipped by 750 to 298,750. The four-week average smoothens out seasonal volatility in the weekly report and is seen as a more accurate predictor of labor-market trends.

  • Wall Street in a swoon over crowd lending

    New York, San Francisco: It took just over an hour for investors in Lending Club, an eight-year-old company that uses the internet to connect borrowers with lenders, to make an extra $3.5 billion (Dh12.9 billion). Shares in the company had been priced at $15 apiece when the New York Stock Exchange opened on Thursday morning. After little more than an hour of back-and-forth between the bankers charged with matching buyers to sellers, Lending Club’s shares began trading at $24.75 — a whopping 65 per cent markup. A cheer rose up on the floor of the exchange from the dozens of early investors and supporters who had been invited by the San Francisco-based company to witness its initial public offering.

  • Regulator: Big banks return to pre-crisis lending standards

    The largest U.S. banks have lowered their standards for some of the riskiest lending in a sign that weak underwriting is returning to levels seen before the 2008 financial crisis, according to a regulator’s report.The banks have continued to erode standards, especially in large corporate loans, consumer loans and in leveraged lending, according to an annual Office of the Comptroller of the Currency survey of examiners released today. Leveraged lending is the risky financing often used to fund corporate buyouts.“As banks continue to reach for volume and yield to improve margins and compete for limited loan demand, supervisors will focus on banks’ efforts to maintain prudent underwriting standards,” said Jennifer Kelly, the OCC’s chief national bank examiner, in a statement. She said the trends are “very similar” to those from 2004 through 2006.

  • Sony Could Lose $100 Million By Pulling 'The Interview'

    Sony announced Wednesday that it's canceling the December 25 premiere of "The Interview" following threats from a hacker group that calls itself Guardians Of Peace.It's unclear whether or not Sony will push the premiere, release the movie online, or scrap it altogether.If Sony chooses to nuke the movie, it could lose about $100 million, according to calculations by The Wrap. That includes production costs, marketing costs, and penalties Sony would have to pay for canceling the movie.

  • Sony Hack Shines Light on North Korea’s Cyber Attackers

    North Korea selects some of its brightest talent for cyberwarfare training and has allocated significant resources to the program as its conventional forces age and become increasingly obsolete, defectors and experts say. The U.S.’s conclusion that North Korea was responsible for the massive hacking attack on Sony Pictures Entertainment has turned the spotlight on cyber operations run by Pyongyang and its emphasis on asymmetric warfare capabilities to maintain its ability to threaten South Korea and others.Late last year, South Korea’s intelligence service quoted North Korean leader Kim Jong Un as saying that cyberwarfare capabilities are “a magic weapon” along with nuclear capabilities that enable Pyongyang to threaten South Korea, according to lawmaker Cho Won-Jin of the ruling Saenuri Party who was briefed by the agency.

  • Republicans livid over Cuba talks, call it appeasement

    Leading Republicans reacted with outrage Wednesday over the Obama administration’s move to normalize relations with Cuba, with some casting it as appeasement and the product of blackmail by the communist Castro government.Sen. Marco Rubio, the son of Cuban immigrants and a likely 2016 presidential contender, was perhaps the most ardent voice to denounce the administration, and one of several Florida Republicans to do so. He and others in the GOP promised to try to derail the White House’s efforts, even as at least one Republican-leaning group, the U.S. Chamber of Commerce, welcomed the news of improved ties with Cuba.

  • U.S. Companies Consider the Possibilities of Cuban Trade

    The White House’s move to normalize ties with Cuba could give U.S. companies access to a market that’s been largely off-limits for more than a half century but has less commercial allure than it once did.U.S. companies from General Motors Co. to agribusiness giant Cargill Inc. to furniture retailer Ethan Allen Interiors Inc. applauded the White House announcement on Wednesday of its move to restore diplomatic relations with Cuba and begin dismantling the embargo in place for 54 years. The effort includes steps to foster commerce between the countries, including authorizing some U.S. exports to Cuba, relaxing restrictions on financial transactions and lifting limits on remittances to the country.

  • Mess in Venezuela Is One Reason Cuba Turned to the U.S.

    Cuba’s decision to agree to a prisoner exchange with the U.S. in return for easing a five-decade embargo comes as the Caribbean island's key benefactor, Venezuela, struggles to avoid default.With Venezuelan President Nicolas Maduro unable to contain the world’s fastest inflation and the country’s bonds trading at default levels, Cuban President Raul Castro has been working to diversify the Communist country’s economy away from Venezuela, which provides about 100,000 barrels of oil a day in exchange for medical personnel.

  • Could Obama’s Cuba Policy Help Democrats in 2016?

    One of the less immediate, but potentially significant, impacts of President Barack Obama‘s decision to normalize U.S. relations with Cuba is a possible expansion of the Democratic Party.Much in the way President Ronald Reagan helped solidify Cuban-Americans as a reliable Republican voting bloc by taking a hard stance against the Castro regime in the 1980s, Mr. Obama’s softening of U.S.-Cuba relations could generate a new crop of Democratic supporters.To be sure, Mr. Obama’s policy changes angered many older Cuban-Americans, who have been reliable Republican voters. But younger Cuban-Americans are likely to largely support Mr. Obama’s moves. And they will be increasingly significant in future elections as the number of first- and second-generation Cuban-Americans decreases.

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