Markets reacted positively for most of the day on the much anticipated announcement that the Federal Reserve would continue providing the U.S. economy with more stimulus in the form of a continuation of its quantitative easing policy.
The central bank said it would continue its quantitative easing program by buying $45 billion of Treasuries each month beginning in 2013, and also would continue buying $40 billion of mortgage-backed securities. It expects to keep rates low until the unemployment rate, now at 7.7%, hits 6.5%.
But the news wasn’t positive enough to offset more fiscal cliff posturing, as House Speaker John Boehner warned his congressional colleagues about heading out on a Christmas break anytime soon.
By the end of the day the markets were mixed. The Nasdaq came out the big loser, down 0.28% to 3,013.82, the S&P 500 managed to hold on to its modest gains, up a fraction at 1,428.48, and the Dow lost a fraction to 13,245.45.
Trading in shares of Berkshire Hathaway (NYSE:BRK.A, BRK.B) was briefly halted ahead of an announcement that Warren Buffett’s firm bought 9,200 of its Class A shares for $131,000 apiece from the estate of a longtime shareholder. All the other investors who stayed in the stock despite the news were rewarded with 2.5% jump in the stock.
Netflix (NASDAQ:NFLX) continued a recent run after its partnership agreement with Disney (NYSE:DIS), rising more than 5% on a Morgan Stanley analyst report targeting $105 per share. NFLX has advanced around 16% in the past month.
Coinstar (NASDAQ:CSTR), which announced that its new video streaming service will be priced at $8 per month, the same as Netflix, rose more than 2%.
In earnings news, Costco (NASDAQ:COST) posted better-than-expected earnings and revenue for its fiscal first quarter, though shares finished down fractionally. Fellow discount retailers Walmart (NYSE:WMT, -2.8%) and Target (NYSE:TGT, -1.5%) trailed even worse.
Lastly, DuPont (NYSE:DD) shares rose nearly 2% after announcing a $1 billion share buyback program and updating its 2012 earnings guidance to the high end of its previous range.
Three Up
- Trina Solar (NYSE:TSL): Up 10.3% (35 cents) to $3.76.
- Zynga (NASDAQ:ZNGA): Up 7.4% (18 cents) to $2.63.
- Research In Motion (NASDAQ:RIMM): Up 5.6% (71 cents) to $13.31.
Three Down
- Cobalt International Energy (NYSE:CIE): Down 7.3% ($2.00) to $25.45.
- LeapFrog (NYSE:LF): Down 5.9% (49 cents) to $25.45.
- Seagate Technology (NASDAQ:STX): Down 4.4% ($1.28) to $27.75.
Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.
