Stocks lose luster after Boehner endorsement of President’s plan
Stocks in the US got off to a positive note on the heels of Monday’s stronger than expected Chinese and EU PMI reports. The positive data along a news that Verizon (NYSE:VM) and Vodafone (NASDAQ:VOD) agreed to a buyout deal on Vodafone’s share of Verizon Wireless, helped stocks gain ground on the open. Also announced over the weekend was the agreement by CBS (NYSE:CBS) and Time Warner (NYSE:TWC) to reestablish an agreement to show CBS programing over the Time Warner network. Additionally, Microsoft (NASDAQ:MSFT) announced that it will purchase the phone business of Nokia (NYSE:NOK) for $7.2 billion dollars. The sale comes at a time when Lumia series is slowly gaining traction in a highly competitive smartphone industry.
On Friday the ISM released a stronger than expected Chicago PMI report which was followed up by a robust national number. The new most affecting stocks during the trading session were the ISM manufacturing report along with construction spending. According to the Institute of Supply Management, U.S. manufacturers expanded at the fastest pace in August more than two years. The Institute for Supply Management index rose to 55.7 from 55.4 in July, better than the 54 expected by economists. The ISM’s new-orders gauge surged to 63.2 from 58.3, but the production index fell to 62.4 from 65 and the employment gauge slipped 1.1 percentage points to 53.3.
News also lifting equity bourses was the better than expected UK construction PMI which unexpectedly rose to 59.1 from 57.0 in July. The consensus had expected a small decline. This follows the 2 1/2 year high on the manufacturing PMI.
Late in the trading session house speaking Boehner endorsed President Obama’s plan for a targeted military strike on Syria. Stocks tumbled immediately moving from a triple digit gain on the Dow Industrials into negative territory. Stocks recovered at the close, edging higher by 23 points.
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