Wall street mixed on acquisitions
Wall Street zigzagged through a listless session today, closing mostly higher as a spate of multibillion-dollar acquisitions lifted the technology sector and energy prices extended their declines.
The gains were limited by airline woes and worries about interest rates.
Monday’s more than US$12bn (€9.77bn) in merger activity signalled optimism on Wall Street two weeks after Hurricane Katrina’s devastation of the Gulf Coast threatened the US economy. But analysts said market was treading water while waiting to see if the Federal Reserve hikes interest rates when policymakers meet next week.
“I think we’re coming to the end of it,” Rick Meckler, president of LibertyView Capital Management, said of the Fed’s yearlong chain of rate increases.
“The rise of energy prices and the general impact of the hurricane would make it dangerous for the Fed to push rates higher and higher.”
Oil and gasoline futures sank, pulled lower by reports that efforts to resume production are progressing after Katrina brought much of the Gulf Coast to a standstill.
Still, officials say nearly 60% of the region’s capacity remains blocked from the market. A barrel of light crude fell 74 cents to 63.34 on the New York Mercantile Exchange, where gasoline futures also slipped 9 cents to US$1.87 (€1.52) a gallon.
The tech sector rallied on news that software maker Oracle Corp. plans to acquire rival Siebel Systems Inc. and online auctioneer eBay Inc. is buying Internet-telephone firm Skype Technologies SA for a combined US$8.45bn (€6.88bn). Wachovia Corp. also agreed to acquire car-financing firm Westcorp.
According to preliminary calculations, the Dow Jones industrial average gained 4.38, or 0.04%, to 10,682.94.
Broader stock indicators were higher. The Standard & Poor’s 500 index dropped 0.92, or 0.07%, to 1,240.56, while the Nasdaq composite index climbed 7.32, or 0.34%, to 2,182.83.
