Sector Wrap: Auto Suppliers Rise
Associated Press
Sept. 18, 2007
NEW YORK -
Shares of the major U.S. auto suppliers closed up Tuesday, after rallying on the Federal Reserve's announcement that it cut a key interest rate for the first time in four years.
The Fed said that it was reducing its target for the federal funds rate, the interest that banks charge each other for overnight loans, by a half-point, from 5.25 percent to 4.75 percent. Many economists had been expecting a cut of a quarter-point.
The move was designed to boost economic growth by lowering borrowing costs for millions of consumers and businesses.
Visteon Corp. (nyse: VC - news - people ), which was upgraded by an analyst to "Neutral" from "Sell" earlier in the day, posted some of the largest gains. Visteon shares rose 42 cents, or 9 percent, to $5.11.
TRW Automotive Corp. also rose significantly, adding $1.44, or 5 percent, to $30.39.
The Livonia, Mich.-based company announced earlier in the day plans to buy part of Delphi Corp.'s North American brake component machining and module assembly assets.
TRW's chief financial officer also spoke to analysts Tuesday and touted the company's financial progress.
Meanwhile, Lear Corp. (nyse: LEA - news - people ) shares rose $1.89, or 6.4 percent, to $31.41 in light trading; Johnson Controls (nyse: JCI - news - people ) rose $5.73, or 5.2 percent, to $116.01; and Tenneco Inc. rose $1.13, or 3.8 percent, to $30.60.
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Print | posted on Tuesday, September 18, 2007 9:10 PM