Weekly market review: week ending Sept. 19
By Christopher Reyes
The stock market finished higher on the week, recovering the loss from last week. The heavily technology allocated Nasdaq was down early in the week in response to news that Oracle’s CEO, Larry Ellison, will be departing the company.
The gains are in part the result of relief that the Federal Reserve made no changes in policy during its meeting on Wednesday. Most expected the Fed to reveal plans to increase short-term interest rates, but instead they announced the rates would remain near zero percent. This decision may be related to recent inflation data that revealed a 0.2 percent decline in August.
Scotland’s vote against breaking from the United Kingdom seemed to have a positive impact on the market. The vote helped the British pound recover against the dollar. Recently investors have feared that gains in the U.S. dollar would cause exports to decrease as American goods become more expensive globally.
The biggest story of the week was Alibaba’s initial public offering. The Chinese e-commerce company experienced the largest ever I.P.O., which gathered $21.8 billion for the company. The I.P.O. places Alibaba among the largest of publicly traded companies in the U.S.
Overall the market is demonstrating risk aversion among investors. This is evidenced by poor performance of volatile, small-cap stocks.