Tuesday, August 17, 2010
Stock Market Commentary:
The major averages rallied after after the latest round of earnings topped estimates and a flurry of mergers and acquisitions (M&A) were announced. Volume totals on were reported higher on both major exchanges versus the prior session, which was a sign that institutional investors were buying shares. Advancers trumped decliners by over a 3-to-1 ratio on the NYSE and Nasdaq exchange as the major averages closed in the middle of their daily range. New 52-week highs outnumbered new 52-week lows on the NYSE but trailed new lows on the Nasdaq exchange. There were 25 high-ranked companies from the CANSLIM.net Leaders List made a new 52-week high and appeared on the CANSLIM.net BreakOuts Page, up from the 11 issues that appeared on the prior session.
Flurry of M&A News Lifts Stocks:
The market opened higher after a flurry of mergers and acquisition news was announced. The “big” news came when an Australian firm made an unsolicited takeover bid of $39 billion for Potash Corp. of Saskatchewan Inc. (POT +27.66%). Potash Corp., the world’s largest fertilizer producer, rejected the unsolicited bid from BHP Billiton Ltd. as too low, but the news helped lift other fertilizers. So far, global M&A business has topped $1.22 trillion in 2010 which is +17% higher than the same period last year, according to Bloomberg. The increase in M&A business bodes well for the ongoing economic recovery.