Everything Must Go! — Thursday’s IP Market Recap

by Marc Bastow | February 14, 2013 5:05 pm

InvestorPlace Market Recap[1]Downbeat news on Europe’s still-sagging economy took a backseat to upbeat economic news and a new wave of suddenly hot M&A activity[2]y.

Berkshire Hathaway (BRK.A[3], BRK.B[4]) on Thursday announced that it will team up with 3G Capital in a $28 billion buyout of foods giant H.J. Heinz (NYSE:HNZ[5]), which was bought at a 20% premium.

Also Thursday, the much-anticipated $11 billion airline merger[6] between US Airways (NYSE:LCC[7]) and American (PINK:AAMRQ[8]) was finalized, creating the world’s biggest airline. LCC shareholders weren’t too happy with the deal, as their holdings dropped 5%.

Meanwhile, Anheuser-Busch InBev (NYSE:BUD[9]) altered the conditions of a buyout of Grupo Modelo (PINK:GPMCY[10]) — including giving Constellation Brands (NYSE:STZ[11]) the permanent right to distribute Corona beer and other Grupo Modelo beer brands in the U.S. — to help the deal win U.S. approval. The move sent STZ shares soaring 37%, while BUD advanced more than 5% on the day.

Despite the increased M&A activity — and improvements in both home foreclosure rates[12] and unemployment claim filings — gains were muted Thursday. The S&P 500 and Nasdaq rose fractionally to 1,521.38 and 3,198.66, respectively, while the Dow Jones Industrial Average struggled in dropping a fraction to end at 13,973.39.

The bright sector spot in the market was in real estate search engine sites Zillow (NASDAQ:Z[13], +8.6%) and Trulia (NYSE:TRLA[14], +5.2%), both of which rose on solid housing news and recent earnings.

Elsewhere, Cisco (NASDAQ:CSCO[15]) shares declined just under 1%, dragging on the Dow, after CEO John Chambers telegraphed a cautious future outlook even as the company reported earnings in line with forecasts. Dow component Coca-Cola (NYSE:KO[16], -1%) also was a Dow drag, continuing its recent swoon; however, rival PepsiCo (NYSE:PEP[17], +1.1%) gained after the beverage maker logged better-than-expected earnings.

Food producer Mondelez (NASDAQ:MDLZ[18]) sank more than 4% after the company announced earnings that missed expectations. General Motors (NYSE:GM[19]) also disappointed with its quarterly results, sending shares lower by 3%.

Finally, Best Buy (NYSE:BBY[20]) shares surged ahead nearly 4% after announcing the much-discussed effort by founder Richard  Schulze to take the company private may be dead[21].

Three Up

Three Down

Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing he did not hold a position in any of the aforementioned securities.

Endnotes:

  1. [Image]: https://www.investorplace.com/hot-topics/investorplace-market-recap/
  2. new wave of suddenly hot M&A activity: http://slant.investorplace.com/2013/02/big-wall-street-buyout-may-be-a-bullish-sign/
  3. BRK.A: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.A
  4. BRK.B: http://studio-5.financialcontent.com/investplace/quote?Symbol=BRK.B)
  5. HNZ: http://studio-5.financialcontent.com/investplace/quote?Symbol=HNZ
  6. airline merger: https://investorplace.com/2013/02/11-billion-merger-to-create-worlds-largest-airline/
  7. LCC: http://studio-5.financialcontent.com/investplace/quote?Symbol=LCC
  8. AAMRQ: http://studio-5.financialcontent.com/investplace/quote?Symbol=AAMRQ
  9. BUD: http://studio-5.financialcontent.com/investplace/quote?Symbol=BUD
  10. GPMCY: http://studio-5.financialcontent.com/investplace/quote?Symbol=GPMCY
  11. STZ: http://studio-5.financialcontent.com/investplace/quote?Symbol=STZ
  12. home foreclosure rates: https://investorplace.com/2013/02/foreclosure-filings-fall-to-lowest-in-6-years/
  13. Z: http://studio-5.financialcontent.com/investplace/quote?Symbol=Z
  14. TRLA: http://studio-5.financialcontent.com/investplace/quote?Symbol=TRLA
  15. CSCO: http://studio-5.financialcontent.com/investplace/quote?Symbol=CSCO
  16. KO: http://studio-5.financialcontent.com/investplace/quote?Symbol=KO
  17. PEP: http://studio-5.financialcontent.com/investplace/quote?Symbol=PEP
  18. MDLZ: http://studio-5.financialcontent.com/investplace/quote?Symbol=MDLZ
  19. GM: http://studio-5.financialcontent.com/investplace/quote?Symbol=GM
  20. BBY: http://studio-5.financialcontent.com/investplace/quote?Symbol=BBY
  21. may be dead: https://investorplace.com/2013/02/best-buy-buyout-may-be-off/
  22. ANGI: http://studio-5.financialcontent.com/investplace/quote?Symbol=ANGI
  23. SPWR: http://studio-5.financialcontent.com/investplace/quote?Symbol=SPWR
  24. ANR: http://studio-5.financialcontent.com/investplace/quote?Symbol=ANR
  25. WTW: http://studio-5.financialcontent.com/investplace/quote?Symbol=WTW
  26. WIN: http://studio-5.financialcontent.com/investplace/quote?Symbol=WIN
  27. CAB: http://studio-5.financialcontent.com/investplace/quote?Symbol=CAB

Source URL: https://investorplace.com/2013/02/everything-must-go-thursdays-ip-market-recap/