Stocks Avoid 6th Straight Losing Session
US stocks started the trading session off on a positive note, as yields on the US continue to move lower making stocks more attractive. On Wednesday the S&P 500 notch up a 5th straight losing session, which weighted on investors sentiment. Economic data in the US continued to show modest results. The final look at second quarter GDP was report on Thursday along with Jobless Claims. Volatility continued to moderate as investor become complacent despite continued budget wrangling.
Although equities continued to be plagued by the deadlock in Congress, investors shrugged off threats of a shutdown by House Speaker Boehner and put their money back in the market following a small decline in initial jobless claims and dovish comments from Fed officials Stein and Kocherlakota.
In corporate news, eBay (NASDAQ:EBAY) , through its PayPal group, agreed to acquire Braintree, the global payment platform powering the next generation of online and mobile-first startups, for total consideration of approximately $800 million in cash. Assuming PayPal’s acquisition of Braintree closes in late 2013, eBay anticipates an immaterial impact to PayPal’s 2013 net total payment volume.
eBay expects that definitional differences between PayPal’s net total payment volume and Braintree’s projected $12 billion payment volume for 2013, approximately one-third of which is expected to be driven by mobile payments, will lead to a significant portion of Braintree’s payment volume not being additive to PayPal’s net total payment volume and treated instead like PayPal’s payment gateway business.
Prior to the opening bell the Labor Department released initial jobless claims. According to the BLS, initial jobless claims declined by 5K, to 305K compared to 310K which was slightly better than expected. US second quarter GDP remained unchanged at 2.5%.
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