Stocks Pushing Higher Yet Again
While Wall Street certainly got a boost from the Fed Wednesday, there's doubt about how long the bulls can keep running. However, futures are indicating another higher open on Wall Street Thursday morning.
Policy makers at the Federal Reserve pledged at the end of their two-day meeting to keep interest rates near record lows until the end of 2014. Rates have been near zero for the past three years, and the Fed will keep them there for another three years. That's bad news for savers looking to earn interest on their money, but good news for businesses, borrowers, and stocks.
The Dow rose more than 80 points Wednesday, and the blue-chip average will open today's session at its highest level in eight months.
The Fed's announcement yesterday also lowered the value of the U.S. dollar and boosted commodities.
"Gold, silver, and copper are making short-term breakouts," notes Greywolf Equity Partners chief technical officer Mark Newton. He adds, "Gold above $1,700 is important," creating at least some temporary euphoria in the metal market.
Two familiar stocks are making waves this morning.
Netflix (NASDAQ:NFLX) shares are surging 17% in pre-market trading to around $111 a share. Remember when Netflix shares peaked at $305 back in July before those controversial price hikes? It looks like the video streaming service is looking to get some of its mojo back.
Netflix reported profits of more than $40 million in the final three months of last year, beating Wall Street expectations; revenue rose by nearly 50% to $876 million, also better than expected. Netflix says it regained 600,000 U.S. subscribers, bringing the total number to 24.4 million as of December.
JC Penney (NYSE:JCP) is trying its hand at a new strategy: permanent price cuts. So, forget about your coupon clipping and deal hunting -- JC Penney says it's not looking to necessarily undercut its competitors, but wants to offer shoppers a consistent value and lower prices all the time.
The price cuts of around 40% take effect next month. JC Penney's new CEO, Ron Johnson, is helping to engineer the retailer's turnaround. He is, coincidentally, the executive who headed up Apple's (NASDAQ:AAPL) retail stores, and he said at a press conference yesterday that Penney's new pricing plan may help triple sales.