Stocks Rise Ahead of Fed Decision

Stocks Rise Ahead of Fed Decision

NEW YORK (AP) -- Stocks are rising Wednesday morning as investors expect the Federal Reserve to raise interest rates, which would be a vote of confidence in the U.S. economy. Utilities and telecommunications companies, which have struggled throughout the year, moved higher.

KEEPING SCORE: The Dow Jones industrial average rose 91 points, or 0.5 percent, to 17,616 as of 10:21 a.m. Eastern time. The Standard & Poor's 500 index gained 9 points, or 0.5 percent, to 2,052. The Nasdaq composite edged up 19 points, or 0.4 percent, to 5,014.

LEADERS: Utility stocks rose about 1.5 percent in morning trading and telecom stocks were up 1.3 percent, both better than the broader market. Utilities are down 10 percent this year.

THE FED: The Federal Reserve is expected to raise interest rates for the first time in almost a decade. The move would be a sign the Fed is confident that the U.S. economy has improved a great deal from the depths of the financial crisis and the Great Recession. Investors will pay close attention to what the Fed says about its future plans on interest rate policy.

CHANGING TIMES: Exactly seven years ago, the Fed cut its key interest rate to nearly zero because of deteriorating conditions in the economy and in financial markets. Spending, business investment and industrial production all fell. The Fed said on Dec. 16, 2008 that the Federal funds rate would be "exceptionally low... for some time." The S&P 500 index was well under 900 points then, and now it's over 2,000.

HEARTLAND: Payment card processor Heartland Payments accepted an offer from Global Payments worth $100 per share, or $4.3 billion. Heartland provides credit, debit, and prepaid card processing and security technology services nationwide. Its shares rose $9.47, or 11.1 percent, to $94.57.

VALEANT RISES AGAIN: Canadian drugmaker Valeant Pharmaceuticals cut its guidance, but investors were pleased with its outlook for 2016. Its stock has lost more than half its value since reaching a record high in August as Valeant's business model and pricing came under close scrutiny from industry analysts and members of Congress.

HOUSING GAINS: The pace of homebuilding increased in November on a big jump in apartment construction in the Midwest and South, while construction of single-family houses reached an eight-year high. The Commerce Department said Wednesday that total housing starts climbed 10.5 percent.

Beazer Homes rose 30 cents, or 2.6 percent, to $11.79. D.R. Horton added 52 cents, or 1.7 percent, to $31.98 and PulteGroup gained 28 cents, or 1.6 percent, to $17.67.

ACROSS THE ATLANTIC: European markets made big gains. The FTSE 100 index of leading British shares was up 1 percent and the CAC-40 in France rose 0.8 percent. Germany's DAX was 0.8 percent higher.

ENERGY: Benchmark U.S. crude slipped 74 cents, or 2 percent, to $36.61 a barrel in New York and Brent crude, a benchmark for international oils, lost 72 cents, or 1.9 percent, to $38.01 a barrel in London. U.S. crude has climbed over the last two days falling beneath than $35 a barrel Monday

Natural gas prices, which have dropped to 16-year-lows, lost 1 cent to $1.81 per 1,000 cubic feet.

BONDS, CURRENCIES: U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.30 percent from 2.27 percent. The euro edged up to $1.0931 from $1.0917 late Thursday while the dollar rose to 121.87 yen from 121.73 yen.