August 24th, 1999

[1:45 PM]
Apple Stock Watch: Fed Hikes Interest Rates, Apple Falls... A Little
The long anticipated fed rate hike cam today, at last. According to a Reuters report:

The Federal Reserve raised two key interest rates on Tuesday by a quarter-percentage point while policy makers signaled they were keeping an open mind on whether to act again in the future.

The US central bank lifted the federal funds rate for overnight loans between banks to 5.25 percent from 5 percent. It moved the less frequently used discount rate up to 4.75 percent from 4.5 percent.

The Fed maintained a "neutral" stance toward any potential changes in rates later on.

This rate hike had long been anticipated, and as such, was "built in" to the stock market. This means that traders had already worked in the rate hike into earlier corrections. The result is the markets were mixed. Apple closed at 60 3/8, a drop of just 3/8 or 0.62%. Volume was moderately heavy with 4,434,100 shares trading hands.

Apple's PC competitors were mostly higher with Gateway 2000, Hewlett-Packard, Dell, Microsoft (closed up more than 5 points on a court victory over Sun), and Intel all closing higher. IBM and Compaq joined Apple on the down side.

The Dow and The NAsdaq were also mixed with The Dow closing down at 11283.30, a loss of 16.46, and the Nasdaq closing up at 2752.37, a gain of 32.80.

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