The market's reborn optimism, evident last
Friday, may enjoy another lift tomorrow, as "Merger Monday" got off to an early start this week. Late Sunday,
announced it has agreed to acquire
HBO & Co.
in a stock swap.
Terms of the merger call for each shareholder of HBO to receive 0.37 shares of McKesson common stock for each share of HBO stock in a tax-free exchange. (Please see the
release for more details.) McKesson is a health-care supply-management company, and HBO is a health-care information company.
Plus, overseas, the
rose 1.72% at the open, climbing 228.26 to 13508.80. Australia's
index was down 0.19%, and the New Zealand
was down 0.47%.
-inspired euphoria may be short-lived, judging by the weekend press reports (of the dead-tree variety).
Headlines such as "A Week for Wishful Thinkers" and "Despite Fed's Rate Cuts, Dangers Remain" sum up the thinking at
The New York Times
. Perhaps the most illuminating business piece in the paper, however, is a page-one story detailing Wall Street firms' eagerness to lend to Russian institutions and how -- of course -- that proved a disastrous strategy.
columnists also took a cynical outlook on the Federal Reserve's intermeeting rate hike. A notable dissenter from this view is
, substitute scribe (that explains it) of "The Trader" column, normally penned by
reviews the newfound optimism of
Morgan Stanley Dean Witter
chief U.S. investment strategist
and ongoing bullishness of
chief investment strategist. The column describes the notion that the Fed eased to pre-empt something wicked from coming this way as "downright paranoid."
IPO Market Attempts Revival
Paranioa has struck deep in the IPO market lately, as offerings from corporate heavyweights such as
have been labeled with the ignominious "postponed indefinitely" moniker. The new-issue market gets a chance at redemption this week with its biggest calendar in two months, headed by
offer, expected Thursday. This spinoff of
oil business is predicted to raise between $3 billion and $3.6 billion -- what would be the largest ever in the U.S. The success or failure of this and other IPOs, as well as reactions to the continued rush of earnings, will reveal rather quickly the sustainability of last week's rally.
Set to Move?
Back to the print pubs. Keeping with recent form, they limited the attention lavished on individual stock-picking. Given the market's erratic and dramatic performance of late, who can blame them? But a few "picks and pans" did emerge.
offers a salivating view of
division, but a less-glowing outlook on prospects for
the stock (vs. Intel, the company).
The paper's "Investing With" column focuses on
Gary M. Lewis
, manager of the
Van Kampen Emerging Growth fund, where big holdings include
. The column offers little insight into whether Lewis is currently adding to any of these positions or what he likes now.
Citing both its traditional defensive characteristics and prospects for uncharacteristic growth,
serves up a plate of supermarket stocks it says are ripe for the picking. Favorites include
reported on Friday that Kroger was in talks to buy Fred Meyer, and that while there's no guarantee of an agreement, a transaction could be announced this week.)
also pointed to smaller names such as
as acquisition fodder.
The weekly's special section on travel suggests vacationing investors look to such "bargains" as
Royal Caribbean Cruises
At the Helm
The weekend's international news was decidedly lacking in market-moving potential. Given recent history, that's good news. Policymakers were also quiet, although
International Monetary Fund
issued public pronouncements.
Camdessus said Sunday there are "more advantages than disadvantages" to an interest-rate cut by either France or Germany, or both, but he understands their reticence. "In particular, they are waiting to see what the effect of the downward move of the U.S. dollar will be on the exchange rates of European currencies,'' Camdessus said, according to
Rubin, the great defender of the greenback, said in a speech Saturday at
Yale Law School
that policymakers have a "good understanding" of the crises, but one of the main challenges is balancing ''the sovereignty of nations on the one hand and the demands of the transnational global economy on the other.'' Acknowledging there are "no magic wands," Rubin added: "A crisis that is a product of problems that developed over many years will take time to work out, and working out requires that each nation -- industrial and developing and each international financial institution -- do its part.''
All together now...