Dow Rally Continues After Buffett Speech

Strategic Insights -

Investors remained bullish on the market after Warren Buffett, the investment guru and CEO of Berkshire Hathaway, expressed confidence in the stocks, citing a sharp drop in interest rates over the past year. This sentiment helped boost the Dow Jones industrial average to a 10 percent gain for the year, with the Dow rising 116.33 to 8,718.85. The rally was further fueled by news of significant deals and mergers in various sectors, including the telecommunications and hospitality industries.

Key Takeaways:

  • The Dow Jones industrial average rose 116.33 to 8,718.85, surpassing last Wednesday's record of 8,675.75 and marking a 10 percent gain for the year.
  • Warren Buffett's upbeat assessment of the market, citing a sharp drop in interest rates, helped boost investor confidence.
  • Alltel Corp. agreed to a $4.1 billion buyout of cellular phone service provider 360 Communications Co., positioning itself as the nation's third-largest wireless communications carrier.
  • The merger of Doubletree's owner with Dallas-based American General Hospitality Corp. marked a significant development in the hospitality industry.
  • S-MOS Systems introduced the world's smallest motherboard for personal computing devices, designed for sub-size and hand-held portable devices.
  • Safety-Kleen Corp. announced a merger agreement with Laidlaw Environmental Services Inc., ending a monthslong hostile takeover battle.
  • Micron Technology Inc. reported a larger-than-expected loss in the fiscal second quarter, hurt by falling prices for its computer memory chips.
  • Golfsmith International is set to open a new superstore in Northwest Austin on April 9.
  • Equity Residential Properties trust acquired 12 apartment properties for $158.2 million, expanding its portfolio to 501 properties in 35 states.

Statistics:

  • Dow Jones industrial average rose 116.33 to 8,718.85.
  • Interest rates dropped sharply over the past year.
  • Alltel Corp.'s $4.1 billion buyout of 360 Communications Co. marked the latest acquisition in the $200 billion-a-year phone industry.
  • Micron Technology Inc. reported a loss of $86.8 million, or 41 cents a share, in the fiscal second quarter.
  • Golfsmith International's new superstore in Northwest Austin will cover 28,000 square feet and cost $2.5 million.
  • Equity Residential Properties trust acquired 12 properties with a total value of $158.2 million.

Sources:

  • AUSTIN AMERICAN-STATESMAN
  • Business Wire
  • Staff and wire reports.