MARKET PREVIEW: Techs active on mergers, stock splits
The broader markets may we wary ahead of the Federal Reserve meeting, but techs are likely to gain on merger, earnings and stock split news. Asian and European markets were sluggish, and the Dow is set to open slightly higher.
U.S.
Those nagging interest rate concerns are likely to keep a lid on the broader markets.
Will the Federal Reserve Board raise short-term interest rates next week? Will it simply adopt a "tightening" bias? Until Tuesday's policy meeting the markets will be on Alan Greenspan watch.
But no need to worry in the tech world. There are plenty of items to chew on.
On the merger front, Cisco Systems Inc. (Nasdaq: CSCO) agreed on Monday to buy the optical networking systems business of Italy's Pirelli SpA for $2.15 billion in stock. Cisco's latest acquisition could be among its smoothest moves considering the valuations fiber optic companies are getting. Another stock to watch in relation to this deal is Ciena Corp. (Nasdaq: CIEN), which competes with Pirelli.
On the earnings front, Red Hat Inc. (Nasdaq: RHAT) reported its third quarter results and a 2-for-1 stock split.
Red Hat reported a loss of $3.6 million, or a nickel a share, on sales of $5.4 million. The results were a penny ahead of First Call consensus.
In other news, Novellus (Nasdaq: NVLS) said its fourth quarter was strong and announced a 2-for-1 split. Cabletron (NYSE: CS) also reports earnings after the bell.
Technology stocks plowed forward Friday, pushing the Nasdaq composite up 38 points to another record close of 3,753.11. The Dow Jones industrial average survived some late selling to close up 13 points.
At the Bell
The Dow Jones industrial average will open slightly higher. The Standard & Poor's 500 index for futures contracts was off 2.6 points to 1442 at 7:44 a.m. EST in 24-hour electronic trading. The dip was still above fair value so the Dow will have a modest gain of a few points.
Asia
Trading in Asia was positive aside from a hiccup in Singapore. The Nikkei 225 was up 0.44 percent to 18,175. Singapore's Strait Times index lost 2.81 percent to 2,369 and Hong Kong's Hang Seng was up 1.41 percent to 16,212.
Europe
European markets were moving up. London's FTSE 100 rose 0.04 percent to 6,727. The CAC 40 in Paris jumped 0.03 percent to 5,504 and the Xetra DAX in Frankfurt was off 0.37 percent to 6,330 at 7:30 a.m. EST.
Reuters contributed to this report.