by Marc Bastow | September 3, 2013 4:46 pm
Investors came back from the long Labor Day Holiday weekend to some big news on the merger and acquisition front that caused the markets to rally early.
Stocks took a hit after after Speaker of the House John Boehner said he would support President Obama’s calls for a military response, but regained momentum to finish with gains across all three indices.
The Nasdaq rose 0.63% to finish at 3612.61, while the S&P 500 closed up 0.42% at 1639.77. The Dow Jones Industrial Average gained 0.16% to end 14.833.96.
The first big bit of news: Verizon’s (VZ) announcement it will pay $130 billion — virtually VZ’s market capitalization — to buy back its 45% stake in Verizon Wireless from Vodafone (VOD).
The move allows Verizon to gain total benefit from the $20 billion in sales generated by the until in the most recent quarter. Meanwhile, Vodafone gains nearly $60 billion in cash. Investors didn’t show much love for the deal, with VZ down almost 3% — the second biggest Dow loser — and VOD in the red over 1%.
Microsoft (MSFT) jumped into the fray as well, announcing it will buy the handset and services business of Nokia (NOK) for $7.2 billion in an all-cash deal. Nokia phones run on Microsoft’s Windows platform, and Nokia CEO Stephen Elop will join Microsoft, fueling speculation he is a possible successor to CEO Steve Ballmer. NOK shares soared over 31%, while MSFT fell over 4% — by far the biggest loss on the Dow.
CBS (CBS) shares rallied nearly 5% after coming to an agreement with cable operator Time Warner (TWC) to air programming in eight cities, including New York and Los Angeles, which were blacked out for the past month.
Vivus (VVUS) shares rose almost 3% after announcing Seth Fischer, a former executive at Johnson & Johnson (JNJ) will take over for Anthony Zook, who has resigned for health reasons after less than one month on the job.
Marc Bastow is an Assistant Editor at InvestorPlace. As of this writing, he was long JNJ, MSFT and VZ.
Source URL: https://investorplace.com/2013/09/tuesdays-ip-market-recap-nokia-msft-vz-vod-cbs/
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