Last Updated Feb 18, 2011 1:40 PM EST Both investors and the financial media spend much of their time and efforts trying to determine what (if any) changes there will be in government policies and how the changes will impact stock prices. This focus increases during periods of financial crises. The questions for investors and policy makers are:What impact will uncertainty about government policies have on stocks prices? What impact will the actual announcements have? In their paper "Uncertainty About Government Policy and Stock Prices," Lubos Pastor and Pietro Veronesi considered two types of uncertainty: Policy uncertainty relates to the uncertain impact of a given government policy on the proï¬?tability of the private sector. Political uncertainty captures the private sector's uncertainty about whether current policy will change. They found that both types of uncertainty affect stock prices in important ways. The following is a summary of their findings: The … [Read more...] about How Uncertainty About Government Policy Affects Stock Prices
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Exxon's growth plans include doubling its annual earnings to $31 billion by 2025 from last year's $15 billion in profit. The increase is based on oil prices remaining at 2017 levels.Woods told New York Stock Exchange analysts that the company projects double-digit returns in all three segments of its business -- oil and gas exploration, refining and chemicals. (See the full investor presentation below).The company plans a five-fold increase in production from the Permian Basin, the hottest oilfield in the U.S. It also will start up 25 projects worldwide to add 1 million oil-equivalent barrels per day. Through its 2017 acquisition of land owned by Fort Worth's Bass family, ExxonMobil said it added an estimated resource of 5.4 billion oil-equivalent barrels in the Permian. That's considerably higher than the company's original estimate of 3.4 billion barrels. Exxon said that effectively reduces the $6.6 billion acquisition cost to just above $1 per oil-equivalent barrel. … [Read more...] about Exxon CEO pledges to double profit, talks Russian writedown, dividends and stock price
By Steve Butler | [email protected] | PUBLISHED: February 16, 2018 at 6:30 am | UPDATED: February 16, 2018 at 6:47 am With the market finally delivering its long-overdue correction, it’s comforting to recall Warren Buffett’s statement: “Stock prices rarely reflect the true value of companies. When it does happen, it’s an accident.” Say again? What do stocks represent if not the value of the companies we have in our mutual funds and investment portfolios? In 2001, one of my weekly columns explained “marked to market,” which is the mechanism through which every single share of stock in a public company is valued from second to second throughout the day. The day’s “closing price“ is the price per share reported for the last sale of the day. All shares are effectively “marked,” or valued, based solely on the price of just those being sold on the stock exchange — an extremely small fraction of the … [Read more...] about Why stock prices rarely reflect companies’ true value
(The Conversation is an independent and nonprofit source of news, analysis and commentary from academic experts.) Richard S. Warr, North Carolina State University (THE CONVERSATION) Stock markets have been on a wild ride recently, plunging one day and then soaring the next. Pundits have offered many reasons for the biggest stock market swoon in two years. One of the most frequently blamed culprits was the threat of inflation, which loosely means an increase in consumer prices over time. That threat became a little more real after the latest data, released on Feb. 14, showed inflation in January rising more than expected, sending stocks and bonds lower. What would prompt something so seemingly banal to send investors into a state of craziness and even panic? A closer look at inflation – a topic I’ve studied closely – and how it affects markets offers some answers. It also hints that an economic slowdown is closer than you may think. What is inflation? … [Read more...] about Why does inflation make stock prices fall?
The explosion of cryptocurrency hasn’t just been good for investors (despite the recent dip in the market)—it’s also helped drive up profits for chip makers like Nvidia, which make processors used for mining cryptocurrency. When Nvidia reported its earnings for the fourth quarter of 2017 Thursday, the maker of graphics processing units (GPUs) revealed it produced revenue of $2.9 billion and a record net income of $1.1 billion. Nvidia’s stock (NVDA) soared following the news, spiking from $217.53 to $238.89 following the record quarter. The nearly 10 percent increase pushed Nvida’s stock price close to its highest value ever. While Nvidia’s products are primarily for gamers and creators who require high-powered processors to handle demanding tasks like displaying games at high resolution, the recent success of the company has been in part pushed by cryptocurrency mining. "Strong demand in the cryptocurrency market exceeded our expectations," … [Read more...] about Nvidia Stock Price: Cryptocurrency Drives Sales, Record Earnings