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Forex · News · USMarket

NEWS / USMarket

USmarket After drop in the beginning of trading session, share indexes again closed day in plus

11:47 10/10/2006

On a background of investors’ concern by messages about the nuclear test led by Northern Korea, contrary to opinion of the world community, trading session began with decrease in key stock indexes.

 

However already in second half of the session when the overwhelming majority of the countries of the world condemned resolutely nuclear attempts of the North-Korean dictator, and oil prices again were below $60 a barrel, having renewed the descending tendency, the bull mood in the market again became prevailing.

 

Let's remind that because of the Columbus Day macroeconomic news yesterday were absent, and the number of participants of the exchange tenders was less than usual, however a series of corporate news about acquisitions and merges in the world of the big business were instantly noticed by the remained market’s participants.

 

So, the main news became information on purchase by financial group PNC Financial Service Group of investment company Mercantile Bankshares Corp. The total sum of the transaction can reach $6 billion. MRBK papers rose in price 22,2 % during yesterday's session and PNC shares dipped 4,3 %.

Thus the majority of analysts are inclined to consider decrease in PNC quotations excessive as Mercantile purchase will allow the buyer to strengthen considerably its positions in such key states as Virginia, Delaware and Maryland, and also capital district of Columbia.

Own capital of new financial group will make now $17 billion and on this parameter it comes nearer the fourth on size financial institutions of USA Wachovia.

Taking into account these factors, Citigroup analysts raised its recommendations on PNC up to a level "to buy".

 

Information, given by the general director of company Citigroup Inc. Chuk Prince in interview to The Financial Times also became positive news for the market.

Chuk Prince declared that the company plans to purchase banks on Taiwan, Turkey, the central America, China and the East Europe, as a part of the plan on increase of profit of assets outside the USA from current 45 % up to 60 %.

After that, by results of session, Citigroup papers added $0,03 and were closed at a level $51,08 for a share.

 

And the leader of yesterday’s growth were shares of Cablevision Systems Corp. which rose in price +10,7 %, or $2,57 up to $26,50.

The reason of significant growth became information that the family of chairman of board Chuk Dolan and the president, and also general director Jim Dolan suggested to redeem their shares at the price of $27 for a share.

As a result, market cost of the operator of cable television systems will make about $7,9 billion.

 

The second in a rating of growth were Chicago Mercantile Exchange papers, which added at once +6,25 %, or $30,69 and were closed at a level of a new historical maximum $521,49 for a share. Chicago Mercantile Exchange representative declared that researches strategic initiatives of development.

 

As a result Dow-Jones index of New York stock exchange was up 7.60 points and was closed at a level 11857.81. NASDAQ index grew 11.78 points and is at a level 2311.77. S&P 500 index rose 1.08 points and is at a level 1350.66.

And 30-years US Treasury notes’ yield fell 0.001 in comparison with the previous closing and makes 4.836.

 

We recommend to keep position outside the market.

 

 

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