Here Are 3 Hot Things to Know About Stocks Right Now
- The Dow Jones Industrial Average
jumped 1.2% on Monday, led by industrial names such as General Electric Co. (GE Boeing Co. (BA and Caterpillar Inc. (CAT as the trade war rhetoric between the U.S. and China cooled.
- The Dow traded above 25,000 on Monday for the first time since March 16.
- General Electric rose 1.94% after reaching an $11.1 billion deal with Wabtec Corp. (WAB to merge the transport operations of the two companies.
Wall Street Overview
Stocks rose sharply on Monday, May 21, as investors reacted to a thaw in the trade war rhetoric between the U.S. and China following a weekend summit in Washington.
While U.S. indices closed Monday's session near session highs, the Russell 2000, which measures volatility, also set a new intraday high for the fourth straight session Monday.
The Dow Jones Industrial Average
The deal, first reported by Reuters and later confirmed by both companies, will see GE receive $2.9 billion in cash from Westinghouse Air Brake Technologies Corp., also known as Wabtec, as the companies combine to create a transportation group with revenue of $8 billion. GE shareholders will hold around 50.1% of the combined company and will maintain the right to grow that ownership going forward.
The companies said the deal is expected to generate more than $6 billion in cumulative free cash flow between 2019 and 2022 but will generate a 15% cash earnings per share accretion in the first year after closing.
GE rose 1.94% on Monday; Wabtec was up 3.53%.TSLA rose 2.77% after CEO Elon Musk, in a series of tweets Saturday, May 19, unveiled plans for an upgrade to the electric carmaker's Model 3 series.
Musk announced two new dual-motor versions of the Model 3. One version of the car will have a top speed of 155 mph and lift its price to around $78,000.
Tesla shares also were supported by an analyst report which suggested the company's flagship Model 3 will be more profitable than most investors anticipate. Berenberg lifted its price target on Tesla to $500 a share, the highest of the major Wall Street firms that cover the company.
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