Monday, September 28, 2009

Monday Morning Musings: Are Merger Mondays Back?

Although it is mostly a slow news morning, as well as a Jewish holiday, there was a flurry of M&A news before the bell:
  • Xerox (XRX) is acquiring Affiliated Computer Services (ACS) for $6.4 billion;
  • Abbot Labs (ABT) is buying Solvay's pharma business for $6.6 billion;
  • American Securities is buying GenTek (GETI) for $38 per share

The stock market is getting a nice boost this morning, after a big down week last week. I suspect that some of this buying is window dressing related to quarter end on Wednesday. Tech stocks are up strong, led by semis, but all 10 S&P sectors are participating.

Asian markets were down across the board overnight, but Europe was higher after Germany's Chancellor Merkel was reelected. The dollar is a bit lower again for the third day, helping boost commodity prices. Oil is higher near $66.50 and gold is up to $995, struggling to get back over the $1000 mark.

The 10-year yield is lower again, to 3.31%; and the VIX is also down today at 25.30 following a 3 day bounce in this index.

Trading comment: I put some money to work Friday. I added to our RIMM positions, and also added to some of our mutual fund holdings in accounts where I had too much cash.

I need to finish my sentiment roundup, and then I will comment on what the indicators are saying. But for the most part, it looks like investor sentiment remains sufficiently skeptical to allow the stair-step market to continue working.

long RIMM


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