Stocks held flat for the entire day up until the Federal Open Market Committee’s release this afternoon, when the Dow Jones Industrial Average dramatically plunged to session lows before rebounding just as fast. As of 2:30 p.m. EDT, the blue-chip index has lost a moderate 55 points after investors unleashed a furious sell-off in the wake of the Fed’s announcement, and then a second wave of traders swooped in to buy. Most Dow stocks are in the red now, but should you be concerned? Let’s check out what the Fed had to say — and why the Dow’s biggest movers are winning or losing today.
Volatility strikes again
All eyes have been on the Fed this week — a few too many eyes, as short term-focused Wall Street traders have looked for cues from the central bank as to the future of quantitative easing. Surprisingly, the dramatic sell-off wasn’t sparked by any change in the Fed’s stimulus plan. On the contrary, the FOMC decided to continue bond-buying at its current $85 billion-a-month rate. It’s another reminder that smart investors should focus on the fundamentals of businesses and stocks, rather than watch the movements of a frequently irrational market that has blown up over nothing today.
Hewlett-Packard Company (NYSE:HPQ) has kept investors smiling today, up 1.1% so far to rank among the Dow’s leaders. Shareholders will have to be patient with the company as it continues its turnaround plan, but Hewlett-Packard Company (NYSE:HPQ)’s making moves to swing away from the downtrodden PC market. Former Hewlett-Packard Company (NYSE:HPQ) personal-computer chief Todd Bradley was reassigned as a vice president of strategic growth today, leaving the company’s dwindling computer business to focus instead on growing the firm’s geographic standing in nations such as China. While it’s a bit of a disappointment for Bradley, Hewlett-Packard Company (NYSE:HPQ)’s in desperate need of a shake-up in its PC business as it looks to transition to mobile and other higher-growth areas.
A number of other Dow stocks aren’t faring as well today, and Verizon Communications Inc. (NYSE:VZ)‘s the worst of the bunch, with shares down 1.5%. America’s leading telecom company announced that it’s weighing a potential entry into the Canadian market with a possible acquisition of Toronto-based wireless carrier Wind Mobile. Wind Mobile boasts more than 600,000 subscribers, and with the Canadian government pushing wireless competition in recent years, the purchase may not be too expensive for Verizon Communications Inc. (NYSE:VZ) to expand north of the border. However, Verizon Communications Inc. (NYSE:VZ) would likely have to bid against other Canadian suitors for the company, which could certainly drive the price of the deal higher.