Why Lumen Technologies Rallied Today
Shares of telecom giant Lumen Technologies (NYSE: LUMN) were rising on Tuesday, at one point up 5%, before reverting to a 1.9% gain as of 2:28 p.m. ET. However, that was still ahead of the broader indexes at that time.
Like many stocks, Lumen rose on the back of this morning's cooler-than-expected inflation report; however, unlike other stocks that made above-market gains, Lumen isn't a high-growth stock. Rather, it has another quality that would also benefit from lower-than-expected interest rates.
Besides growth stocks, heavily indebted companies would also benefit handsomely from lower interest rates. This is because heavily indebted companies not only need a strong economy to deliver operating profits to service their debt, they also will likely need to refinance existing debt when it comes due.
Source Fool.com
