U.S. Personal Income Rises 0.3%; Dow, Nasdaq Up 1%

Arthi Gupta
27 Jun, 2011
New York City

U.S. indexes traded higher after personal income rose 0.3% in May. S1 agreed to merge with Fundtech in $700 million stock swap purchase. Metropolitan Health agreed to acquire Continucare for $416 million.

[R]10:45 AM New York – U.S. indexes traded higher after personal income rose 0.3% in May. S1 agreed to merge with Fundtech in $700 million stock swap purchase. Metropolitan Health agreed to acquire Continucare for $416 million.[/R]

European markets gained a fraction in a cautious trading as investors speculated the quick passage of Greek austerity measures this week. Banks edged lower after new capital rules require an increase in capital. Asian markets declined tracking the Friday’s losses in Europe and New York.

The Greek Parliament begins a debate on the austerity measures today and a vote is expected on Wednesday.

Separately, the French government and banks agreed on a Greek debt rollover plan involving longer maturities, a banking source said on Sunday, confirming a report in Le Figaro newspaper.

Under the plan, creditors would reinvest 70% of the proceeds reimbursed when Greek debt falls due, with 50% of maturing Greek debts in newly issued Greek securities of 30 years and the balance 20% reinvested into zero-coupon bonds.

Chinese Premier Wen Jiabao said it would be difficult to cap inflation at 4% target this year but estimated below 5%, Hong Kong based Cable TV quoted him as saying.

In its annual report, the Bank for International Settlements says the persistence of very low interest rates in major advanced economies delays the necessary balance sheet adjustments of households and financial institutions.

U.S. Personal Income Rises

Personal incomes in the U.S. increased 0.3% or $36.2 billion, in May, according to data released Monday by the U.S. Commerce Department today.

Consumer spending increased $4.6 billion or less than 0.1% in May. In April, personal income rose 0.3%, DPI increased 0.2% and PCE increased 0.3% on revised estimate.

S1 Merges with Fundtech

S1 Corporation and Fundtech Ltd. entered into an agreement to combine their businesses through a stock-for-stock merger valued at approximately $700 million, creating an industry leader in transaction banking solutions.

Stanley Black & Decker Offers to Acquire Niscayah

Stanley Black & Decker, the diversified industrial company offered to acquire Niscayah Group AB, a commercial security and monitoring company specializing in electronic security services and solutions based in Stockholm, Sweden, for SEK18.00 a share in cash.

The total transaction value including assumed debt would be SEK7.6 billion or $1.2 billion.

Metropolitan Health Acquires Continucare

Metropolitan Health Networks, Inc., the healthcare service provider agreed to Continucare Corp. in a cash and stock deal valued at about $416 million. The combined company will generate annual revenues of about $660 million.

Earnings Review

Amgen, Inc. ((AMGN)), the independent biotech developer reaffirmed its guidance for 2011 and 2015. The company estimated revenue of $15.1 billion to $15.5 billion and adjusted earnings of $5 to $5.20 a share for 2011.

The company provided its 2015 guidance estimating revenue of $16 billion to $18 billion and adjusted earnings of $7.25 to $8.60 per share in April.

MDU Resources Group, Inc. ((MDU)), the natural resource company reaffirmed its fiscal 2011 earnings guidance of $1.05 to $1.30 a share.

Park Electrochemical Corp. ((PKE)), the global advanced materials company reported first quarter net sales fell 12.2% to $51.8 million, compared to $59.0 million a year ago. Net earnings in the quarter declined 27.3% to $7.2 million, or 35 cents per diluted share compared to net earnings of $9.9 million, or 48 cents per share last year.