Why Shares of Wells Fargo Are Rising Today
Shares of Wells Fargo (NYSE: WFC) had risen more than 4% as of 2:15 p.m. ET today for no obvious reason, although I am guessing the move has something to do with the fact that the bank is a big beneficiary of rising interest rates.
At its meeting earlier this month, the Federal Reserve raised its benchmark overnight lending rate, the federal funds rate, for the first time since 2008. As expected, the Fed increased the benchmark rate to a range of 0.25% and 0.5%.
The surprise in the meeting, however, came from the Fed's more hawkish stance, in which it said it expects to raise rates at each of its next six meetings this year and then potentially another four times in 2023. That's 11 rate hikes in two years. Fed Chairman Jerome Powell has also recently said he is open to doing a half-point move all at once if needed, which is double the Fed's standard 25-basis-point moves.
Source Fool.com
