Today the lift may stick because there is less emotion than there was on Monday as the market was relieved about Rita.
Perhaps this invalidates my idea from yesterday about the quarter closing out quietly. Maybe we can see a nice lift. Obviously I can't know how many buy-siders need the market to rally, if you know what I mean.
Oil is continuing to work higher, the curve is getting a little flatter, the dollar weaker against the commodity currencies and stronger against the others.
I like the merger Gazprom is doing, although this one is foreign. M&A is a sign of confidence about the future. I am worried about 2006 domestically but it can still be a great year for foreign markets and I could be wrong about 2006 being bad in the US.
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3 comments:
"M&A is a sign of confidence about the future." - Roger: I don't know if I can agree with your view, respectfully, if companies see no need to spend excess capital (i.e., cash on the balance sheet) on middle market companies that offer no compelling future market share gains or technological advances to their (buyers) benefit...but then again, I could be wrong!
the idea of M&A as a sign of confidence is a very common type of text book truthism, meaning it my not be true, the point made in the comment is much narrower than the concept.
Having worked in large companies, M&A activity generally means management has a lack of high return internal projects to invest in, a desire to build an empire, or both. Rather than return excess cash flow to shareholders in the form of dividends/buybacks, they go down that road. And the returns of the acquisition never met projections. JMO.
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