Portfolio Crafter
11-21-2006, 07:55 PM
End of Day Market Summary Monday 11/20/2006
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Stocks closed mixed with the Dow Jones Industrial Average snapping a six-day winning streak, as waning forward momentum led to selling pressure. A spate of mega-merger news, including Freeport-McMoRan Copper & Gold's $26 billion deal for Phelps Dodge Corp., the Blackstone Group bid $20 billion to take Equity Office Trust private, and many more kept the day interesting.
Today, the Dow Jones industrial average closed down 26.02 or 0.21% to 12,316.54, the broader S&P 500 index closed down 0.70 or 0.05% to 1,400.50, and the Nasdaq composite index closed up 6.86 or 0.28% to 2,452.72.
Market breadth was mixed. On the New York Stock Exchange, winners topped losers by a narrow margin on volume of 1.50 billion shares. On the Nasdaq, decliners and advancers were roughly 15 to 14 on volume of 1.72 billion shares.
Trade was muted as investors played it cautious ahead of a holiday-shortened trading week. However, the market was helped by the bevy of merger and acquisition news. While the deals did not move the market, they represent that Corporate America believes the economy is not heading for a recession and that you still have a growth story for 2007. While there is a lot of talk about the market being in an overbought condition, there are still people who are afraid of missing out on the rally. There's a lot of excess cash that people will want to put to work.
The session's one economic report was the index of leading economic indicators (LEI). LEI rose 0.2% in October after climbing an upwardly revised 0.4% in September. Economists had expected the LEI to rise 0.2%. This suggested the economy is still expanding at a slow pace.
Stock of Equity Office Properties Trust closed up $3.42 or 7.6% to $48.14, after it agreed to a $36 billion buy-out. This acquisition by Blackstone Group represents the largest deal ever for real estate investment trusts. The offer of $48.50 per share in cash - an 8.5% premium to the stock's last closing price - values the equity of the company at nearly $19 billion.
Shares of Phelps Dodge Corp. closed up $25.45 or 27% to $120.47. Its acquisition by Freeport-McMoRan Copper & Gold will create the world's largest publicly traded copper producer. However, shares of Freeport closed down $1.77 or 3% to $55.63. Phelps Dodge will be bought for $25.9 billion in cash and stock.
Russian steelmaker Evraz will buy Oregon Steel Mills in a $2.3 billion deal, creating the world's largest rail producer. Shares of Oregon Steel closed up $4.81 or 7% to $63.77. The offer is 22.3% above the weighted average stock price for the past three months. The combined company would produce 16.8 million tons a year of crude steel, placing it just outside the world's top 10, and will ship 17.4 million tons of steel products in 2006.
Shares of Bank of America closed up $0.05 to $54.90, after it declared that it was buying U.S. Trust - the private banking unit of Charles Schwab for $3.3 billion. Shares of Charles Schwab closed up $0.38 or 2% to $18.94. This would vault Bank of America to the top tier of private banks.
U.S. light crude oil for January delivery fell 17 cents to $58.80 a barrel on the New York Mercantile Exchange.
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by Portfolio Crafter (http://www.portfoliocrafter.com?a_aid=fiasco)
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Stocks closed mixed with the Dow Jones Industrial Average snapping a six-day winning streak, as waning forward momentum led to selling pressure. A spate of mega-merger news, including Freeport-McMoRan Copper & Gold's $26 billion deal for Phelps Dodge Corp., the Blackstone Group bid $20 billion to take Equity Office Trust private, and many more kept the day interesting.
Today, the Dow Jones industrial average closed down 26.02 or 0.21% to 12,316.54, the broader S&P 500 index closed down 0.70 or 0.05% to 1,400.50, and the Nasdaq composite index closed up 6.86 or 0.28% to 2,452.72.
Market breadth was mixed. On the New York Stock Exchange, winners topped losers by a narrow margin on volume of 1.50 billion shares. On the Nasdaq, decliners and advancers were roughly 15 to 14 on volume of 1.72 billion shares.
Trade was muted as investors played it cautious ahead of a holiday-shortened trading week. However, the market was helped by the bevy of merger and acquisition news. While the deals did not move the market, they represent that Corporate America believes the economy is not heading for a recession and that you still have a growth story for 2007. While there is a lot of talk about the market being in an overbought condition, there are still people who are afraid of missing out on the rally. There's a lot of excess cash that people will want to put to work.
The session's one economic report was the index of leading economic indicators (LEI). LEI rose 0.2% in October after climbing an upwardly revised 0.4% in September. Economists had expected the LEI to rise 0.2%. This suggested the economy is still expanding at a slow pace.
Stock of Equity Office Properties Trust closed up $3.42 or 7.6% to $48.14, after it agreed to a $36 billion buy-out. This acquisition by Blackstone Group represents the largest deal ever for real estate investment trusts. The offer of $48.50 per share in cash - an 8.5% premium to the stock's last closing price - values the equity of the company at nearly $19 billion.
Shares of Phelps Dodge Corp. closed up $25.45 or 27% to $120.47. Its acquisition by Freeport-McMoRan Copper & Gold will create the world's largest publicly traded copper producer. However, shares of Freeport closed down $1.77 or 3% to $55.63. Phelps Dodge will be bought for $25.9 billion in cash and stock.
Russian steelmaker Evraz will buy Oregon Steel Mills in a $2.3 billion deal, creating the world's largest rail producer. Shares of Oregon Steel closed up $4.81 or 7% to $63.77. The offer is 22.3% above the weighted average stock price for the past three months. The combined company would produce 16.8 million tons a year of crude steel, placing it just outside the world's top 10, and will ship 17.4 million tons of steel products in 2006.
Shares of Bank of America closed up $0.05 to $54.90, after it declared that it was buying U.S. Trust - the private banking unit of Charles Schwab for $3.3 billion. Shares of Charles Schwab closed up $0.38 or 2% to $18.94. This would vault Bank of America to the top tier of private banks.
U.S. light crude oil for January delivery fell 17 cents to $58.80 a barrel on the New York Mercantile Exchange.
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