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The debate continues on the merger of XM (XMSR ) and Sirius (SIRI ) Satellite Radio as the case again comes before the Senate Committee on Commerce for round four since its original proposition in February. Opponents argue that the merger will create a monopoly, leaving a sole provider for satellite service to consumers. This, they argue, will lead to increased prices and decreased content. Advocates argue that the merger is necessary in order to compete against other technologies, including terrestrial radio, MP3 players, CD/DVD etc. The inference is that the battle between the two small companies for the limited audience is splitting the market and preventing its advance against the other technologies.
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Ethanol-Biofuels Fed Rate Cut Could Drive Oil Prices Higher
Ethanol-Biofuels Fed Rate Cut Could Drive Oil Prices Higher
| Fed Rate Cut Could Drive Oil Prices Higher |
| Written by Miranda Marquit | |||
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Oil stocks could get a double boost. Today, a Fed rate cut is expected. And this means that oil prices could continue to move higher, the AFP reports: The Federal Reserve is expected to announce their rate decision later today, with a 0.75-1.0 percent cut widely anticipated. This would weaken the dollar and could potentially push oil prices back up, though the US economy remains weak.Because oil prices traditionally move inversely with the dollar and interest rate cuts are seen as weakening to a currency, the chain of events is expected to result in higher oil prices. But that's not the only reason Big Oil stocks are likely to move higher. A Fed rate cut generally stimulates gains on the stock market, since it lowers borrowing costs for companies, allowing for larger profits. So this means that Big Oil stocks like Exxon (XOM), ConocoPhillips (COP) and Chevron (CVX) are expected to gain along with other companies. In fact, they are already up this morning with the mere anticipation of this afternoon's Fed rate cut. The current climate is one that should be helpful to Big Oil stocks, and should see them enjoying some solid gains, thanks to support from both oil prices and the stock market. Disclosure: I do not own XOM, COP or CVX. Site disclaimer.
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