It looked like stock markets were going to start off the week sharply higher today until House Speaker John Boehner said he would support President Obama's request to use force in Syria. Then we went back to the old war-fearing sell-off. Late in the trading day, the Dow Jones Industrial Average (INDEXDJX:.DJI) is up just 0.17%, and the S&P 500 is up 0.43%.
Economic data was fairly strong today, and a rash of M&A activity over the weekend should have given the market a bit of a boost, but Syria has overshadowed that for a week now. Purchasing managers' indexes released by Markit and the Institute for Supply Management read 53.1 and 55.7%, respectively, both indicating economic expansion in August.
Positive PMI data and the possibility that the Department of Defense will loosen its purse strings to pay for an attack in Syria have pushed United Technologies Corporation (NYSE:UTX) 2.6% higher today. Pratt & Whitney is the company's second-largest division, and UTC Aerospace Systems also generates a significant amount of revenue from the military, so an increase in spending would definitely help operations. Most people aren't rooting for war in Syria, but if it happens, United Technologies Corporation (NYSE:UTX) will benefit financially.
The big loser today is Microsoft Corporation (NASDAQ:MSFT) after it announced that it will buy Nokia Corporation (ADR) (NYSE:NOK)'s handset business. Think what you will about the deal, but keep in mind that with Microsoft Corporation (NASDAQ:MSFT)'s stock down 5.1% today, its market cap is down about $19 billion. Considering the fact that Microsoft Corporation (NASDAQ:MSFT) is only paying $7.2 billion for Nokia Corporation (ADR) (NYSE:NOK), the market currently thinks this will destroy another $12 billion in value. That's wildly overblown, even if the Microsoft Corporation (NASDAQ:MSFT)-Nokia Corporation (ADR) (NYSE:NOK) merger doesn't result in strong growth in the handset business.
The article Stocks Sink After Boehner Backs Syria Strike originally appeared on Fool.com and is written by Travis Hoium.
Fool contributor Travis Hoium manages an account that owns shares of Apple and Microsoft. The Motley Fool recommends Apple and Google. The Motley Fool owns shares of Apple, Google, and Microsoft.
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