September 23rd, 2013 – September 27th, 2013
Welcome to Financial Buzz Market Weekly, at the New York Stock Exchange, bringing you a review of this week’s stock market.
The market started off the week with a bad case of indigestion caused by the surprise decision last week of the Fed not to curb its bond buying stimulus program, as well as a growing threat of a government shutdown. Congress must agree on a budget before the start of the government’s fiscal year on October 1. If they don’t, a government shutdown will occur which could force some Federal employees into unpaid temporary leave. In addition Congress must also agree to raise the debt ceiling so the U.S. Treasury can continue to borrow money.
Meanwhile, China offered up a nice surprise when the HSBC flash Purchasing Managers’ Index hit a six month high of 51.2 in August. A score above 50 on the PMI indicates increasing factory activity.
BlackBerry Ltd. (NASDAQ: BBRY) agreed to be purchased by Fairfax Financial Holdings Ltd (OTC: FRFHF) for $9/share, for a total deal worth $4.7 billion. Fairfax is also BlackBerry’s largest shareholder, already owning about 10% of the company.
Apple Inc. (NASDAQ: APPL) announced that sales for its new iPhone set a record, with over 9 million units sold just after its launch. Apple shares were up sharply on the news. Facebook Inc. (NASDAQ: FB) hit a record high after a Hong Kong newspaper reported that the social networking giant would be allowed into China in a special free-trade zone to be located in Shanghai.
Home prices in the S&P Case-Shiller index rose .6% month to month and 12.4% year to year, while durable goods orders in August rose .1% month-to-month, a dramatic improvement over July’s 8.1% decline.
Jobless claims dropped to 305,000, once again coming in below analyst’s expectations. It’s good news as the number of Americans filing new claims for jobless benefits fell to a near 6 year low. The Commerce Department said second quarter GDP rose 2.5%, accelerating from the 1.1% increase in the first quarter.
Now let’s review some stocks. MAKO Surgical Corp. (NASDAQ: MAKO) shares reached an all time high, increasing by over 80%, when they announced they will be acquired by Stryker Corporation. MAKO makes medical devices, including orthopedic implants and robotics to assist surgeons.
Knight Transportation (NYSE: KNX) publicly announced their plan to acquire USA Trucks by offering to pay $9 share plus assumption of debt, for a total deal worth $242 million. USA Trucks, however, rejected the offer as insufficient.
Finally, Kior Incorporated (NASDAQ: KIOR), a biofuel producer, announced that Khosla Ventures has tentatively agreed to invest up to $50 million in Koir’s Columbus, Mississippi production facility, ultimately allowing it to double production capacity.