The market is flying today, primarily on deal-driven enthusiasm.
Charles Schwab is scooping up OptionsXpress for $1 billion. The most interesting part of that deal is that if your look at a chart of $OXPS it was headed to a 52 week low until Friday’s buying ahead of the actual announcement.
Shareholders loved the AT&T bid for T-Mobile even if the anti-trust issues threaten to severely alter it if and when it finally goes through. Sprint is getting creamed – all last week the stock advanced on murmurs about it having its own deal with T-Mobile. Guess not. If Sprint’s CEO Dan Hesse were less busy doing his own commercials like it’s the Hair Club for Men or something, he wouldn’t have been caught completely flat-footed and surprised. The board should chop him down by the end of this week.
I have a convoluted theory as to why in the long run Sprint is a winner based on its newfound scarcity value, but The Street ain’t having none of that today, the stock’s down 13% as of this post. Analysts expect $S to trade lower over the near-term as Special Situations money comes out on the disappointment.
Brett Arends at MarketWatch is fuming over the anti-competitive ramifications of the merger for what it’s worth.
Other news the market appears to like includes the 1-for-10 reverse split for Citigroup along with the return of a nominal dividend just to put it back in the divvie-paying category. Will Citi trading back up in the 50’s bring the shorts back out? Shorting AIG post reverse didn’t help work very well…