Futures Rise As Microsoft Corporation (MSFT) Buys 1/2 of Nokia Corporation (ADR) (NOK)

Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes — just in case they’re material to our investing thesis.

Labor Day weekend is a popular shopping holiday, and this year businesses splurged as well. Two corporate deals were announced over the weekend totaling more than $137 billion. The deal-making is pushing the Dow Jones Industrial Average solidly higher this morning: Stock index futures as of 7:20 a.m. EDT pointed to an 85-point bounce at the opening bell.

Microsoft Corporation (NASDAQ:MSFT)

Microsoft Corporation (NASDAQ:MSFTannounced today that it is buying its way into the handset market. The company reached an agreement to purchase Nokia Corporation (ADR) (NYSE:NOK)‘s devices and services business. It plans to scoop up that division, along with licenses to Nokia’s patents and mapping services, for about $7.2 billion in cash. Close to 32,000 Nokia Corporation (ADR) (NYSE:NOK) employees will transfer to Microsoft Corporation (NASDAQ:MSFT), including current leader Stephen Elop, who was previously a Microsoft Corporation (NASDAQ:MSFT) executive in charge of the business division. Elop’s name has been suggested as a potential replacement for CEO Steve Ballmer, and this deal makes that even more likely. Altogether, Microsoft Corporation (NASDAQ:MSFT) is acquiring businesses that generated 50% of Nokia Corporation (ADR) (NYSE:NOK)’s sales last year. In premarket trading, Microsoft Corporation (NASDAQ:MSFT)’s stock is down by about 5%, while Nokia Corporation (ADR) (NYSE:NOK)’s shares have surged about 46%.

Not to be outdone, fellow Dow component Verizon Communications Inc. (NYSE:VZ) finalized a deal with Vodafone Group Plc (ADR) (NASDAQ:VOD) that, at $130 billion, is the second-largest purchase ever. Verizon Communications Inc. (NYSE:VZ) will get full ownership of its wireless business, which logged $76 billion in revenue last year and boasts 100 million customers. But it had to pay up for that prize. Verizon had reportedly wanted to spend closer to $100 billion, but it relented as spiking interest rates threatened to raise borrowing costs too high to finance the deal. For its part, Vodafone Group Plc (ADR) (NASDAQ:VOD) plans to distribute much of the windfall to shareholders, rather than its own splashy acquisitions. Verizon and Vodafone are down by 4.5% and 1.5%, respectively, in premarket trading.

Economic data released over the weekend continued to point to a steady global recovery, as economies in Europe and Asia are showing evidence of stronger growth ahead. The United Kingdom’s purchasing manufacturers’ index surged to 57.2, the highest level since early 2011, while China’s PMI hit a 16-month high.

Closer to home, investors will get a key reading on the U.S economy today. The ISM factory index, due for release at 10 a.m. EDT, is expected to read 54, indicating continued expansion in the manufacturing sector.

The article Dow Futures Surge After Microsoft Buys Half of Nokia originally appeared on Fool.com and is written by Demitrios Kalogeropoulos.

Fool contributor Demitrios Kalogeropoulos has no position in any stocks mentioned. The Motley Fool recommends Vodafone. The Motley Fool owns shares of Microsoft.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!