Yahoo’sacquisition of Overtureand a Merrill Lynch upgrade of Intelsent stocks higher on Monday.
The Overture buyout is the latest in a string of takeovers that have investors thinking that some stocks remain undervalued and that business confidence may be returning. And at a price-to-earnings ratio of 23, Yahoo isn’t getting a bad price for Overture, which rose 12% on the news. Looksmartsoared 25% on speculation that it could be acquired by MSN.
Intel climbed 3% after Merrill upgraded the stock to Buy from Neutral, saying that gross margins should improve over the next 6-8 quarters as the company moves toward mobile machines and 300mm technology, and cuts prices less aggressively in the desktop market. Intel reports earnings tomorrow night, and analysts expect earnings of 13 cents a share, a 39% improvement from the year-ago quarter.
The broader market gained on strong earnings from Citigroupand Bank of America, but finished well off its highs on a sell-off that was blamed on an erroneous sell program.
The Nasdaq rose 20 to 1754, the S&P 500 climbed 5 to 1003, and the Dow gained 57 to 9177. Volume rose to 1.43 billion shares on the NYSE, and 1.97 billion on the Nasdaq. Advancers led 19-13 on the NYSE, and 20-11 on the Nasdaq. Upside volume was 64% on the NYSE, and 79% on the Nasdaq. New highs-new lows were 361-4 on the NYSE, and 435-3 on the Nasdaq.
After the close, Rambusmissed earnings estimates by a penny with 4-cent earnings.
During the day, JD Edwardsclimbed 1.3% after the Justice Department cleared the company’s merger with PeopleSoft. Oracleslipped as it now faces a potentially higher price tag in its bid to takeover PeopleSoft.
Broadcomgained 5% on a new Fast Ethernet switch.
TiVoclimbed 5% on a partnership with AOL.
McDataand Network Appliancerose after they extended their partnership.
Sonysurged 6% on a glowing Barron’s cover story. If you’d bought it when we highlighted it back in April, you’d be up 42%.
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