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BlackBerry Ltd Preparing to Lay Off 40% of Staff; Global Stocks Surge on Fed Inaction


Gold spiked after Bernanke put off the day of reckoning.

Only Ben Bernanke can get such a huge reaction by doing nothing.

Stocks surged worldwide after the Federal Reserve surprised the world and announced that it will not scale back its $85 billion monthly asset purchases. The Fed said that it needs stronger evidence of an economic recovery before it stops its stimulus. Market watchers were sure that the taper they were forewarned about months ago was going to come yesterday.

Treasury bonds had their biggest rally since 2011 and gold prices rose 4.5% on the news that the Fed will push back the day that it will taper off quantitative easing.

US stocks continued to rally after global equities jumped to a five-year high yesterday. Before the opening bell, Dow (INDEXDJX:.DJI) futures were up 0.17% at 15,620. Futures contracts on the S&P 500 (INDEXSP:.INX) gained 0.28% to 1,622.60 and Nasdaq (INDEXNASDAQ:.IXIC) futures rose 0.26% to 3,230.25. Gold prices fell 0.75% at $1,299.60/oz.

Initial jobless claims rose from a seven-year low last week to 309,000. A computer error was reportedly behind the previous week's plunge to 292,000, and that was revised up by just 2,000. The four-week moving average slid to 314,750 weekly filings.

After 10 a.m., we will get US existing home sales for August. Last month, the pace or pre-existing home purchases likely fell to an annualized rate of 5.255 million from 5.39 million in July, according to economists expectations. The Philadelphia Fed will release its regional survey. The index is projected to rise to 10 from 9.3 this month.

Oracle (NASDAQ:ORCL) shares fell 1.09% after it reported a lackluster quarter and reduced guidance. In its fiscal first quarter, Oracle earned $0.59 per share, as revenue rose to $8.37, missing analyst expectations. The business software company's earnings outlook for the current quarter is between $0.64 and $0.69 per share, which also trailed expectations.

Yesterday, the Wall Street Journal reported that BlackBerry Ltd (NASDAQ:BBRY) is preparing to lay off as much as 40% of its current staff to make itself more attractive for private equity buyers. The latest figures show that the smartphone maker employs 12,700 people.

McDonald's Corp (NYSE:MCD) hiked its quarterly dividend by 5% to $0.81 per share yesterday, but shares of the fast food company were down 0.15% this morning.

Twitter: @vincent_trivett

Disclosure: Minyanville Studios, a division of Minyanville Media, has a business relationship with BlackBerry.
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