What's Going On With AT&T Shares?

AT&T Inc. T shares are trading slightly lower by 0.5% to $15.05 during Monday's session, depsite a lack of company-specific news. Telecommunications stocks are volatile in recent sessions with concerns about future rate hikes following last Wednesday's FOMC statement and lower-than-expected initial jobless claims data.

AT&T has a substantial amount of debt due to its acquisitions and investments in its network infrastructure. If the Federal Reserve signals future interest rate hikes, it could lead to higher interest expenses for AT&T, as the company may need to refinance debt or secure new financing at higher rates.

Higher borrowing costs can reduce AT&T's profitability and potentially strain its finances.

AT&T also invests heavily in its network and technology infrastructure. Higher interest rates can influence the company's decisions regarding capital spending.

If financing becomes more expensive, AT&T may need to reassess and potentially scale back its investment plans, which could also affect its long-term growth prospects.

AT&T stock is also known for its dividend payments, and it is often considered by income-focused investors. When interest rates rise, fixed-income investments like bonds become more attractive in comparison to dividend-paying stocks.

This can lead some investors to shift their investments away from stocks like AT&T, potentially putting downward pressure on its stock price.

What's Going On?

The Federal Reserve last week maintained the federal funds rate within the 5.25% to 5.5% range at its September meeting in a unanimous move.

The September dot plot reveals the median preference for the fed funds rate at the close of 2023 remains unwavering at 5.6%. This figure mirrors projections made back in June, hinting at the possibility of one more rate hike during either of the last two meetings this year...Read More

According to data from Benzinga Pro, AT&T has a 52-week high of $21.53 and a 52-week low of $13.43.