Saturday, February 2, 2008

Microsoft aims to buy Yahoo

U.S. stock index futures rose sharply on Friday, boosted by Microsoft Corp's proposed acquisition of Internet media company Yahoo Inc for $44.6 billion.
News of the deal on Friday sent stock futures soaring, with S&P futures more than tripling.
S&P 500 futures were up 10.40 points, well above fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.
Dow Jones industrial average futures were up 122 points. Nasdaq 100 futures were up 15.50 points.
Software maker Microsoft said it offered to buy Yahoo in a cash and stock deal valued at $44.6 billion. Yahoo was not immediately available for comment.
Shares of Yahoo rose 53.8 percent to $29.50 before the opening bell, while Microsoft shares fell 2.2 percent to $31.89.
"That seems to be eclipsing everything and set the futures off and running," said Paul Mendelsohn, chief investment strategist at Windham Financial Services, Charlotte, Vermont. "It's offsetting the Google news from last night."
Web search company Google Inc reported revenue and profit that missed Wall Street's estimates late on Thursday, sending its stock lower.
While the proposed deal gave a boost to futures, investors were anxious about the January employment data from the Labor Department due at 8:30 a.m.
"A really bad employment report could knock the steam out of this market," Mendelsohn said. But, "you could easily have a 200 to 300-point up day if you have a good labor report. As long as we're over 50,000 (in job creation), it should have a positive impact on the market."

No comments: