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

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

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!