By Nicholas K
5:33 AM UTC
It’s a mixed day in markets today, after yesterday’s news from the Federal Reserve. The FED Chairman Jeremy Powell offered a roadmap for the raising of interest rates in 2020. This led to an instant drop in the value of most stocks.
That’s because investors are still apprehensive of the risks that this poses to the economy. The economy is just reopening after a pandemic shutdown that has devastated most sectors of the economy. However, the Fed has downplayed the impact of the interest rates increase and offered a rationale for it. Powell stated that the increase in interest rates was meant to cushion the economy in the future.
He stated that consistently maintaining low inflation would diminish expectations of inflation. This, in turn, would lower the Fed’s ability to stabilize the economy by cutting interest rate. It is on this basis that the Federal Open Market Committee was unanimous in its approval of an allowance for inflation to rise to slightly over 2% for a while.
While this has dampened the market to some extent, the markets are still supported by hopes of a COVID-19 vaccine. Several companies are already in advanced stages in the push for a workable vaccine. Success on this front would counteract the negative effects of an increase in interest rates since it would restart the economy across all sectors. In this environment of mixed sentiment, there are stocks that are rallying this morning. Some of the stocks that are in gains ahead of markets are as below:
Just Energy Group Inc [NYSE: JE]
Just Energy Group Inc is a top performer this morning and is up by over 80%. This follows the company’s announcement that it had approved a recapitalization plan. The company is part of the company’s plan to de-risk and achieve more sustainable growth. Through the recapitalization, the company announced that the move would improve the company’s finances by injecting more than $100 million and cut on net debts and the costs of preferred shares by $520 million. The improved outlook could play a role in the stock’s performance throughout the day.
Nortech Systems Incorporated [NASDAQ: NSYS]
Nortech Systems Incorporated is up by over 50% this morning. This comes after the company announced that it had completed a sale and leaseback deal. The deal is for the company’s manufacturing facilities that are located in Bemidji and Mankato for $6.3 million. The company’s CEO Jay D. Miller stated that he was happy with the deal’s success. He added that the deal had generated cash that had improved the company’s balance sheet and put it in a position to make strategic investments.
MICT Inc [NASDAQ: MICT]
MICT Inc is another top performer this morning and is up by 20%. This is momentum-based and follows the company’s announcement early last week that it had received its first order for its video telematics product.