Tech Stocks in U.S., Europe and Asia Rebound
May 31, 5:16 PM EDT |
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| U.S. economic growth slowest the weakest pace in 4 years. Morgan Stanley agreed to buy Investa Property Group for $3.9 billion. |
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| First quarter economic growth rate for the U.S. was revised to 0.6% from the previous estimate of 1.3%. The slow down was the slowest since Q4 in 2002. In other economic news in the U.S., construction spending rose 0.1% in April, and jobless claims fell 4,000 to 311,000 at the end of the last week. Wachovia agreed to purchase A.G. Edwards for $6.8 billion, only second to Merrill Lynch in number of brokers. Ceridian agreed to be bought out for $36 $5.3 billion. Dell to eliminate 10% staff. |
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Utilities and Techs Boost Europe
May 31, 1:19 PM EDT |
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| ASML Holding rose 5% after the chip-equipment maker said it will return 960 million euros to shareholders. |
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| European stock markets gained ground on Thursday, posting solid gains which managed to offset the steep declines of the previous trading session. Utilities led gainers, with Germany’s E.On rising 4.1%. Again in the sector, shares of German RWE rose 3%, while Scottish & Southern added 0.9% in London on strong full-year profit growth. The German DAX 30 increased 1.5%, the French CAC-40 rose 1%, while the U.K.''s FTSE 100 advanced 0.3%. |
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Ceridan to Be Acquired for $5.3 B
May 31, 12:00 PM EDT |
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| Construction spending edged up 0.1% in April following an upwardly revised 0.6% increase in March. |
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| U.S. market averages posted gains Thursday morning, buoyed by another wave of takeover deals which helped offset weaker-than-expected economic growth in Q1. In addition to Wachovia''s decision to buy brokerage A.G. Edwards for $6.8 B, Morgan Stanley announced that it bought Australia''s Investa Property Group for $3.9 B. In another deal, Ceridian said late Wednesday it will be bought out by investment firm Thomas H. Lee Partners LP and insurance provider Fidelity National Financial for $5.3 B. |
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Costco Profit Meets Estimates
May 31, 11:05 AM EDT |
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| Motorola lost 1.2% after the mobile phone maker announced a decision to cut 4,000 jobs, due to slower mobile phone sales. |
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| On the earnings news front, discount retailer Costco Wholesale added 0.6% after it posted Q3 profit drop of 4.9%, which came in line with estimates. Jewelry seller Tiffany & Co. rose 1% after reporting a 15% rise in Q1 profit, indicating that consumer demand for big-ticket items remains strong. Retailer Sears Holdings reported 20% quarterly earnings increase, but said its U.S store sales decreased. Shares of Sears fell 2.2%. |
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GDP Revised down 0.6%
May 31, 10:14 AM EDT |
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| Costco added 0.6% after the retailer reported a 5% drop in net profit that was in line with analyst expectations. |
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| Wall Street opened in the positive on Thursday, as a multibillion-dollar takeover deal in the brokerage sector helped offset lower-than-expected economic growth. First-quarter growth was revised down to 0.6% from an initial estimate of 1.3%. The market welcomed news that Wachovia agreed to buy brokerage A.G. Edwards for $6.8 billion. In other news, Morgan Stanley bought Australia''s Investa Property Group for $3.9 billion. |
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FTSE Buoyant on Johnson Matthey, Miners
May 31, 9:35 AM EDT |
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| Strong miners and broker upgrade of Johnson Matthey buoyed the FTSE 100 in London on Thursday. |
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| Johnson Matthey, the platinum specialist, leads the advancers Thursday in London after Citigroup raised its recommendation on the company. BHP Billiton announced that it has apponted new chief executive and that fact lifted the stock. Scotish and Southern Energy also advanced on broker comment, while Vodafone broke its winning streak and fell. By mid-day, the FTSE 100 index added 36 points at 6,337.8. |
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Market to Open Slightly Up
May 31, 9:18 AM EDT |
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| Crude oil futures fell 39 cents to $63.18 a barrel in electronic trading. The dollar was mixed vs. other major currencies, while gold prices rose. |
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| U.S. stock futures were indicating a slightly higher opening on Thursday, reflecting mixed economic data. The Commerce Department said that Q1 GDP advanced 0.6%, lower than the 1.3% projected in April and lower than analyst estimates of 0.8%. However, the Labor Department reported positive news, saying that the number of U.S. initial jobless claims dropped last week for the sixth time in seven weeks. |
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China Bounces Back, Japan Gains
May 31, 8:52 AM EDT |
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| Asian stocks staged a strong recovery on Thursday with Shaghai surging in late trading and Japan advancing on robust U.S. close. |
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| Asian markets recovered Thursday from their declines yesterday with Japan and HK leading, while in China, the Shanghai benchmark index bounced back after plunging more than 6.5% yesterday. Indices in Tokyo and HK were supported by the strong close in New York overnight. Shares in Australia and Seoul also advanced, while markets in Thailand and Singapore were closed for public holidays. |
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Wachovia Buys A.G. Edwards for $6.8 B
May 31, 8:14 AM EDT |
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| Wachovia Corp. announced early Thursday it agreed to acquire A.G. Edwards Inc. in a cash-and-stock deal worth $6.8 billion. |
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| The takeover bid values A.G. Edwards at $89.50 per share based on Wednesday''s closing prices, a 16% premium. The deal is expected to close in Q4 of 2007, whereas full integration of A.G. Edwards with Wachovia Securities is expected to be completed by early 2009. |
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Sensex Rallies 0.9%, GDP at 9.4%
May 31, 8:10 AM EDT |
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| The Sensex in India rallied Thursday to a three-month high on strong buying in tech and financial stocks. Hero Honda surged 5%. |
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| The market exhibited a volatile session Thursday with a number of large-cap stocks, mainly in the technology and banking sector, soaring and aiding the rally. Strong GDP figures for the January-March period and buying in May 2007 derivatives, which expired today also supported the rally. In the fiscal year ended March 2007, the Indian economy grew at 9.4% rate. |
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