The Nasdaq composite plunged 105 points, or 3.7%, Thursday despite Fed Chairman Alan Greenspan’s statement in support of tax cuts and his suggestion that the Fed will lower interest rates again next week.
Greenspan told the Senate Budget Committee today (Jan. 25) that economic growth has basically stopped. This led many bankers to assume the Fed will lower interest rates when it meets next Tuesday and Wednesday (Jan. 30-31). Some bankers now believe the Fed will cut rates 0.5% next week, which would lower the benchmark prime interest rate to 8.5%.
Greenspan also said he believes the federal government’s budget surplus has grown to the point where a tax cut would be “economically sound.”
The Dow Jones Industrial Average recorded a modest increase in light of Greenspan’s remarks. It gained 83 points, or 0.8%.
Among RV stocks, Holiday RV Superstores posted a strong gain Thursday after reporting that its profits were higher at this year’s Florida RV Supershow than was the case a year-ago. Holiday RV’s stock climbed 17/32, or 14%, to close at 4 7/16.
Here is a roundup of the other RV company stock activity on Thursday:
Fleetwood gained 3/8 to close at 14 5/16
Winnebago declined 5/16 to close at 17 5/8
Thor declined 9/16 to close at 23 1/2
Coachmen gained 5/16 to close at 11 3/8
Monaco declined 1/16 to close at 19 7/8
National RV gained 1/4 to close at 13
Skyline declined 5/16 to close at 21 7/8
SMC gained 1/16 to close at 3 5/16
Rexhall gained 1/8 to close at 6 1/8
Kit declined 1/16 to close at 3 3/8
Coast Distribution was unchanged at 1 1/8
Featherlite was unchanged at 2 1/8
Spartan Motors gained 1/8 to close at 2 13/16
Starcraft gained 3/32 to close at 1 31/32