Stocks Move Higher in New Year
Traders looked ahead after a dismal 2008. Bank of America and Wells Fargo completed acquisitions, while GMAC disclosed the articles of agreement of a $5-billion government capital injection
By Ben Steverman
Stocks opened slightly higher on the pristine trading day of 2009, by investors looking ahead after the worst year for shares since the 1930s.
Meanwhile, European and Asian markets rallied Friday, though more markets remained closed and trading volume worldwide was light.
The Dow Jones Industrial average dropped 33.8% in 2008, the broader S&P 500 index fell 38.5% and the Nasdaq composite had its worst year ever, plunging 40.5%.
Wells Fargo (WFC) and Bank of America (BAC) both officially completed major acquisitions in the new year. BofA closed its $19.4-billion buyout of Merrill Lynch, and Wells Fargo finished its acquisition for $12.7-billion of Wachovia.
GMAC, the financial arm of General Motors (GM), will get a $5 billion forfeiting life injection in reciprocity for 5 million preferred shares paying 8% premium. GMAC disclosed the terms Friday.
Traders and economists were waiting for greater quantity clues on the guidance of the economy from the ISM index, scheduled for release later Friday.
On Friday morning, however, the 30-stock Dow Jones pertaining average opened higher by 26.29 points, or 0.3%, to 8,802.68. The broader S&P 500 index gained 1.81 points, or 0.2%, to 905.06. The tech-heavy Nasdaq composite index added 1.12 points, or 0.13%, to 1,579.15.
Among other stocks in the news, BorgWarner (BWA) received notice from TRC Capital Corp. to buy 2.5 million shares, or about 2.16% of BorgWarner’s shares outstanding, at $20 each. Shares closed on Wednesday at meanly $22, and the firm recommends stockholders not gentle their shares in response to the offer.
Time Warner Cable (TWC) and Viacom (VIA) reached a degree in prime mover to renew Time Warner’sitting carrying of MTV cable networks. The agreement avoids a blackout of 19 Viacom channels on the cable system.
Gramercy Capital Corp. (GKK) announced it would not recompense a dividend in quest of the fourth quarter of 2008, an effort to retain needed forfeiting life. Dividends paid earlier in the year satisfy the firm’s distribution requirements as a real estate investing. trust, Gramercy said.
Abigail Adams National Bancorp (AANB) will be acquired by Premier Financial Bancorp in a stock deal valued at $10.9 very great number.
In other markets, bonds moved higher, rebounding from a rout upon the body Wednesday. The 30-year bond gained 1-04/32 to 138-02/32 for a yield of 2.633%; the 10-year list of items added 13/32 to 113-31/32 for a yield of 2.173%; and the two-year note was up 02/32 to 100-10/32 for a yield of 0.733%
Oil prices were dropping Friday, by Action Economics saying traders feel a year-end restore to order for crude was “excessive.” On the NYMEX, uncouth oil lost $2.21 to $42.39 per barrel.
Gold was lower at 871.30. The U.S. dollar index was basically shallow at 81.68.
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