US stocks climb in early trading; Precision Castparts jumps on Buffett's $32 billion bid
U.S. stocks opened higher Monday as investors assessed the latest corporate deal news. Precision Castparts led industrial stocks higher after Warren Buffett's Berkshire Hathaway agreed to buy the maker of aircraft components for $32 billion.
KEEPING SCORE: The Standard & Poor's 500 index rose 19 points, or 1 percent, to 2,097 as or 10:01 a.m. Eastern time. The Dow Jones industrial average gained 171 points, or 1 percent, to 17,540. The Nasdaq composite climbed 55 points, or 1.1 percent, to 5,099.
BUFFETT BID: Precision Castparts jumped $37, or 19 percent, to $230.88 after Berkshire Hathaway said it was buying the company for about $32.4 billion. Berkshire will pay $235 per share in cash for Precision Castparts' outstanding stock. The deal is valued at about $37.2 billion, including debt. The deal is the biggest of Buffet's career.
LOSING STREAK: The Dow is rebounding from a seven-day losing streak, the longest run of losses in four years. A slump in oil prices and some mixed earnings reports have weighed on the 30-member index.
EUROPE'S DAY: France's CAC 40 was up 0.5 percent and Germany's DAX rose 0.7 percent. Britain's FTSE 100 dropped 0.7 percent.
CHINA TRADE: China's trade figures shrank by unexpectedly wide margins in July, showing the world's second-largest economy faces weak demand both at home and abroad. Exports contracted by 8.3 percent over the same month a year earlier, and imports fell 8.1 percent. For the year to date, exports are off 14.6 percent and imports are down 0.8 percent. That increases pressure on Beijing to stimulate domestic growth and to avert politically sensitive job losses in export industries.
ENERGY: Benchmark U.S. crude was up 7 cents to $43.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 7 percent last week.
BONDS AND CURRENCIES: U.S. government bond prices fell. The yield on the benchmark 10-year note climbed to 2.22 percent from 2.17 percent on Friday. The dollar rose to 124.69 yen from 124.22 yen on Friday. The euro edged down to $1.0968 from $1.0969.