Street Sees a Major Rally After Cliff Deal; Tech Stocks Surge (AAPL, HPQ)
The last minute budget deal reached in Washington along with technology stock gains pushed the major US indices higher on Wednesday. The passed legislation late on Tuesday will prevent most impending tax hikes and postpone spending cuts by two months. Taxes will be raised on the 2% of Americans who are the wealthiest. Moody's stated that while a cliff deal was reached, there is still much work to be done in the coming weeks. Tech stocks Hewlett-Packard (HPQ) and Apple (AAPL) caused the Dow to have its best single-day point rise since 2011.Another member of the tech industry, eBay (EBAY) also saw big gains and led the S&P 500 higher. Warren Buffett's MidAmerican Energy has acquired SunPower photovoltaic projects for $2.5 billion. The CBOE Market Volatility Index or "fear gauge" fell to the lowest level in five weeks.
Word on the Street
- US manufacturing unexpectedly grows during December while the euro zone slumps further.
- EBay (EBAY) outperforms other tech companies in 2012.
- MidAmerican Energy Holdings agrees to spend $2.5 billion on PV deal.
- Construction spending drops in November, surprising many economists.
- Moody's expects more budget measures to lower future deficits and stabilize the bond rating.
- Avis Budget Group Inc (CAR) makes $500 million deal to buy Zipcar Inc (ZIP).
- Apple Inc. (AAPL) sees positive sentiment from analysts, leading Wednesday's tech rally.
Published on Jan 2, 2013By InvestorGuide Staff