advertisement
Article Tools
| Currency | US Dollar |
|---|---|
| British Pound to US Dollar | 1.661900 |
| Euro to US Dollar | 1.485000 |
| Japanese Yen to US Dollar | 0.011100 |
| Canadian Dollar to US Dollar | 0.930600 |
Shares of Yahoo (YHOO, news, msgs) jumped nearly 7% Friday on reports that Microsoft (MSFT, news, msgs) is raising its bid for the Internet company.
The Wall Street Journal said talks between the companies were "intensifying" in a last-ditch effort to reach a friendly deal. The New York Times said Microsoft has raised its bid, originally valued at $31, by "several dollars." CNBC's Jim Goldman said the offer apparently has been raised to $33. (Microsoft is the publisher of MSN Money.)
Whether $33 or even $34 is enough to win approval from Yahoo's management isn't clear. Yahoo insiders reportedly have demanded $35 to $37 a share, which would boost the cost of the deal from $44 billion to something perhaps as much as $50 billion.
No deal was imminent on Friday, and the talks could collapse. But Reuters quoted a source who said Microsoft hoped to get a decision over the weekend.
Yahoo closed at $28.67, up $1.86 from Thursday and was up an additional 1.6% to $29.12 in after-hours trading.
Microsoft was off 0.5% to $29.24 and moved down an additional nine cents to $29.15 in after-hours trading.
The news came as the stock market closed Friday mostly higher despite a sharp jump in the price of crude oil. The Dow Jones industrials closed up 48 points, or 0.4%, to 13,058. The Standard & Poor's 500 Index was up nearly 5 points to 1,414. But the Nasdaq Composite Index was off 4 points to 2,477, weighed down for most of the day by a surprising quarterly loss from Sun Microsystems (JAVA, news, msgs). Sun Microsystems fell nearly 23% to $12.64.
Some reports in the last 24 hours or so have said Microsoft was leaning toward launching a hostile bid for Yahoo. Others suggested that Microsoft might abandon its offer altogether or start a new round of talks.
Microsoft's board of directors met on Wednesday, and Chief Executive Officer Steve Ballmer was vague about the company's plans in a Thursday meeting with employees. "I know exactly what I think Yahoo is worth to me, exactly," Ballmer said. "I won't go a dime above."
Every dollar added to the per-share price amounts to about $1.4 billion extra for the total deal at current prices.
Microsoft offered $44.6 billion for Yahoo on Feb. 1. Yahoo rejected the $31 cash-and-stock offer as too low.
While Yahoo looked around for an alternative merger partner, none has emerged. Microsoft's offer for Yahoo was now valued at $29.48 per share, with Thursday's close.
Meanwhile, The Journal reported that Yahoo might announce a advertising deal with rival Google (GOOG, news, msgs) in the next week. Yahoo would carry search ads from Google, The Journal said, in a nonexclusive deal to try to avoid antitrust issues.
Yahoo is still in talks on an alternative to the Microsoft bid, sources familiar with the matter told Reuters on Friday.
| Close for week | Wk. ago close | % chg. | YTD. chg. | |
|---|---|---|---|---|
| Dow Jones industrials | 13,058.20 | 12,891.86 | 1.29% | -1.56% |
| S&P 500 | 1,413.90 | 1,397.84 | 1.15% | -3.71% |
| Nasdaq Composite | 2,476.99 | 2,422.93 | 2.23% | -6.61% |
| Russell 2000 | 725.74 | 721.88 | 0.53% | -5.26% |
| Crude oil per barrel | $116.32 | $118.52 | -1.86% | 21.19% |
| 10-yr. Treasury yield | 3.85% | 3.87% | -0.54% | -4.71% |
| Gold per troy ounce | $858.00 | $889.70 | -3.56% | 2.39% |
Why stocks ended flat
If you thought the rising dollar means steadily lower prices for commodities including crude oil and gasoline, guess again.The dollar moved higher Friday. But so did prices for crude oil, gold, copper, silver and corn.
The market, however, did withstand the commodity pressure. Twenty-two of the 30 Dow stocks were higher on the day. So were 267 S&P 500 stocks. But only 45 of the stocks in the Nasdaq-100 ($NDX.X) index had gains. The index finished slightly higher at 1,982, thanks to Yahoo's late-day rally.
The Dow's leader Friday was a classic commodities-related stock: Alcoa (AA, news, msgs), up 4% to $36.11.
While many investors were disappointed that the early rally faded, stocks finished higher for a third consecutive week. The Dow ended the week up 1.3%, mostly thanks to Thursday's big rally that pushed the blue-chip index up 190 points. The S&P was up 1.2% on the week; the Nasdaq added 2.2%.
Down as much as 12.2% for the year on March 10, the Dow finished at its highest level of the year on Friday, exceeding the Jan. 3 close of 13,056.72 by 1.5 points. However, the blue-chip index is still down 1.6% from Dec. 31, 2007. The S&P 500's loss is now just 3.7%, and the Nasdaq is still down 6.6%.
The Dow started Friday with a gain of 110 points, but a rally in oil prices stalled the rally, said Doug DePietro, director of U.S. cash trading at Citigroup.
Crude oil jumped 3.4% to $116.32 a barrel after tumbling to $112.52 on Thursday, trimming its weekly loss to 1.9%. For the week, crude was down 1.9%; it's up 21% on the year. Wholesale gasoline jumped 3.9% to $2.97 a gallon. Energy stocks moved higher as a result. Anadarko Petroleum (APC, news, msgs) jumped 3.1% to $67.10. Schlumberger (SLB, news, msgs) added 1.3% to $99.63.
To be sure, some investors were cashing in their winnings from Thursday's rally. And the pullback from the morning rally was hardly a panic.
| Fri. | Thur. | Chg. | Month chg. | YTD chg. | |
|---|---|---|---|---|---|
| Crude oil (NYMEX) (per barrel) | $116.32 | $112.52 | $3.80 | 2.52% | 21.19% |
| Heating oil (per gallon) | $3.2187 | $3.1177 | $0.1010 | 1.31% | 21.49% |
| Natural gas (per million BTU) | $10.7770 | $10.5610 | $0.2160 | -0.61% | 44.02% |
| Unleaded gasoline (per gallon) | $2.9664 | $2.8540 | $0.1124 | 1.20% | 19.09% |
Jobs report: Not great, but not awful
The Labor Department's jobs report Friday showed a loss of 20,000 jobs in April, but it could have been worse. Most economists had expected jobs to fall by 75,000 to 85,000.Meanwhile, the unemployment rate fell to 5.0% in April from 5.1% in March; economists had expected it to tick up to 5.2%.
April's job losses were the fourth consecutive monthly decline, fueling concern about the economy. In March, 80,000 jobs were shed from the economy; in total, about 232,000 jobs were lost in the first quarter of 2008.
Continued: The weaknesses in the jobs report
Rate this Article
High