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11:43PM (15 mins delay)
Nov 05, 2009 - 4:16 PM EST
Economic news has dominated the headlines this week as the markets have raced higher. The Dow, S&P 500 and Nasdaq all are trading higher by more than two and a half percent this week as investors have become increasingly bullish on the economic recovery. On Wednesday afternoon, the FOMC announced it would be keeping rates low for an extended period of time, in the range of zero percent to one quarter of one percent. The Federal Reserve plans to increase liquidity in the hopes of fostering further economic growth, but in reaction to the Fed's policy, investors flocked to the golden safe haven sending spot gold prices as high as $1095/ounce as inflation fears were fanned. On the week, the SPDRS Gold ETF (GLD) climbed more than four percent despite the modest pullback today. In the agriculture sector, merger news has crowded the headlines of late. CF Industries (CF) announced on Monday that it had increased its bid for Terra Industries (TRA) to $40.50 in cash and shares. Terra Industries rejected this bid as being inadequate and opportunistic. In an ironic twist of fate, CF Industries has been fending off a hostile takeover from Agrium (AGU) as well. Agrium increased its bid to $95 in cash and shares today, valuing CF Industries at more than $4.5 billion. Merger talk has sent the sector soaring this week, as the PowerShares Global Agriculture ETF (PAGG) has climbed over one percent today and by more than five percent so far this week. And Intel has been in the headlines this week and investors were not happy. The bad news began on Tuesday when Morgan Stanley downgraded the entire semiconductor sector to Cautious as analysts with the firm believes PC demand will decline from here. Morgan Stanley downgraded Intel from Overweight to Equal Weight in its report, sending shares lower. Microsoft's CEO Steve Ballmer lent credibility to Morgan Stanley's downgrade when he told a meeting of executives in South Korea that he does not expect IT spending to recover to pre-recession levels. The bad news from Intel has weighed on the Semiconductors HOLDRs ETF (SMH) this week, as the ETF is lagging the general markets this week despite gains of almost three percent today. For MarketNewsVideo.com, I'm Justin Shackil.Source: Market News Video (Nov 05, 2009 - 4:16 PM EST)
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