As the Fed prepares for tomorrow’s policy meeting, US stocks moved higher on Tuesday ahead of possible stimulus action. The Dow ended at its highest since December 2007, nearly five years ago. The United States also saw some negative news with reports of a growing trade deficit and Moody’s announcement that the country’s triple-A rating may be stripped, causing the dollar to fall to a four-month low. McDonald’s Corp (MCD) advanced after their reported increase in sales while Citigroup (C) was hit by $2.9 billion on their Smith Barney sale. In global markets, European equities rallied to reach thirteen-month highs while Asian stocks fell as investors await important announcements starting on Wednesday.
Word on the Street
- The US trade gap widened during the month of July, now a $42 billion deficit.
- Citigroup (C) and Morgan Stanley’s (MS) deal comes to $13.5 billion, a figure in between their two estimates.
- Statements released from Moody’s saying the US may lose its triple-A debt rating.
- Family health plan premiums only went up 4% this year – but average almost $16,000.
- US stocks up on Tuesday, positioning the Dow for its highest close in almost five years.
- Eastman Kodak Co. (EKDKQ) has replaced its CFO and plans to cut another 1,000 jobs.
- Shutterfly (SFLY) Firms Up But Analysts Remain Divided.