Dow Jones today, Aug. 18, 2014:U.S. stocks soared Monday on positive housing data and growing merger and acquisition activity, and the Dow gained 175 points. The S&P 500 Index is again taking aim at the historic 2,000 mark, while the Nasdaq is back at a 14-year high.
Geopolitical issues in Iraq and Ukraine were tame this afternoon, much to the relief of investors, but to the detriment of oil prices. Brent crude fell below $102 a barrel, and West Texas Intermediate, which is priced in New York, slipped below $97 per barrel.
Here's the scorecard from today's trading session:
Merger Mania: Sharesof Family DollarStores Inc. (NYSE: FDO) were up almost 5% on the day, rallying after news broke that Dollar GeneralCorp. (NYSE: DG) has offered to purchase the company for roughly $9.7 billion. The bid tops an $8.5 billion offer from rival Dollar TreeInc. (Nasdaq: DLTR). Shares of Dollar Tree dropped 2.5% on the news, while Dollar General saw its shares soar more than 11.5% on the day.
Nasdaq Rally: The Nasdaq hit a 14-year high this afternoon, buoyed by its tech-heavy roster of stocks. The rally was fueled by companies like Yahoo! Inc. (Nasdaq: YHOO) and Google Inc. (Nasdaq: GOOG, GOOGL), which rallied 2.5% and 1.5% respectively.
Housing Hopes: Positive news in the housing sector fueled the markets and homebuilding companies this afternoon. The PHLX housing sector index jumped 1.4%, which propelled housing stocks. The National Association of Home Builders/Wells Fargo Housing Market Index hit 55 in August, its highest level in seven months. On the day, PulteGroup Inc. (NYSE: PHM) was up more than 2.3%, while D.R. Horton Inc. (NYSE: DHI) added more than 1% on the day.
Drink Up: Shares of Monster Beverage Corp. (Nasdaq: MNST) slipped more than 5% as the euphoria surrounding Monster's deal with The Coca-Cola Co. (NYSE: KO) subsides. Last week, Coca-Cola announced plans to purchase 16.7% of the company in a cash deal worth $2.15 billion. The deal will see the companies swap several beverage units between themselves, with Monster focusing more on energy drinks and Coca-Cola streamlining its businesses to focus on non-energy drinks. Shares of Coca-Cola were up more than 1% on the day.
Deadline Problems: One of the year's largest potential mergers is hitting some problems as a self-imposed deadline approaches. Shares of Canadian-based Valeant Pharmaceuticals International Inc. (NYSE: VRX) were down more than 2% and shares of Allergan Inc. (NYSE: AGN) were down more than 1.5% on news that Valeant has extended its offer deadline from last Friday to Dec. 31. The companies' inability to take part in today's broad rally is a sign that some investors are growing impatient with the ongoing merger drama and that they are unwilling to wait for Allergan to accept the deal.
Now our experts share some of the most important investment moves to make based on today's market trading - for Money Morning Members only:
The Single Best Investment for the Semiconductor Boom: At first glance, two major trends reshaping the semiconductor industry seem contradictory... On the one hand, the industry is in the midst of a major boom. On the other, it's also contracting. So, how is this possible? And more important... how can we make money off it? Michael has a plan for us to outperform the market over the long term with one easy investment...
Profit from the World's Largest E-Commerce Market: Mainland China has leapfrogged the United States to become the biggest e-commerce market on Earth. We wanted you to hear about some of the best new opportunities - so you can reap the biggest payoffs...
This Northern Metals Boom Will Give Us More Than 10 Times the Returns of the S&P 500: In the last three years, junior miners have, as a group, lost about 58%, while the S&P 500 is up 52%. But it's looking increasingly like we're entering a brand new boom phase, with junior gold miners up as much as 45.8% this year - with a lot more in store... Here are two to consider...
Garrett Baldwin is a globally recognized research economist, financial writer, consultant, and political risk analyst with decades of trading experience and degrees in economics, cybersecurity, and business from Johns Hopkins, Purdue, Indiana University, and Northwestern.