Following a morning session in the red, stocks rallied in the latter half of the trading day after the Federal Reserve released the Minutes of its September meeting.
The S&P 500 climbed above 2,000 for the first time since September 17, and crude oil topped $US50 per barrel for the first time since July 21.
First, the scoreboard:
- Dow: 17,077.74, +165.45, (0.98%)
- S&P 500: 2,016.41, +20.58, (1.03%)
- Nasdaq: 4,818.79, +27.64, (0.58%)
And now, the top stories on Thursday:
- Most Federal Open Market Committee members still think an interest rate hike is possible this year. According to the Minutes from the September meeting, the Fed decided to wait on concerns about sluggish inflation and global economic growth, particularly in China. It also did not want to hike rates with inflation below its 2% target, as this could have hurt its credibility. The Fed remarked that the pullback in equities in August was likely because investors believed stocks were expensive; the Fed agreed.
- Bill Gross is suing PIMCO for “hundreds of millions of dollars” over his exit from the investment management firm he co-founded. In a court complaint, Gross alleged that “a cabal” of managing directors ousted him because of “a lust for power, greed, and a desire to improve their own financial position.” Gross claimed that he was due to receive a bonus totaling about $US250 million last year, but was booted days before the end of the third quarter when he would have been due to receive a hefty sum.
- Etsy shares fell as much as 5% after Amazon launched a competitor. Amazon Handmade starts with 5,000 sellers of craft goods and 80,000 items. Analysts have said these numbers will balloon and slow Etsy’s revenue growth. Etsy CEO Chad Dickerson said in a statement that the company serves artists and sellers “in ways that no other marketplace can.”
- Netflix rebounded from a slump to rally 5% after the company announced that it is increasing the price of its most popular streaming plan by $US1. According to Bloomberg, new customers in the US, Canada and Latin America will pay $US9.99 a month. Existing customers have a grace period, varying in length, before the hike kicks in.