MStanley Buys EVance and A Few Technical's
NEW YORK (AP) — Morgan Stanley will buy the investment management firm Eaton Vance in a deal valued at about $7 billion.
Eaton Vance shareholders will receive $28.25 per share in cash and 0.5833 of Morgan Stanley common stock, or approximately $56.50 per share. Based on the $56.50 per share, the amount paid to Eaton Vance shareholders will consist of about 50% cash and 50% Morgan Stanley common stock. (AP)
What do we think of the deal? Well this tweet from @RudyHavenstein sums it up for us:
As far as the action today, markets are up and continue to press the buy button but with bonds up also (yields down) we may be in a regime now where rising tides lift all boats and until the election becomes clear, this might be the path of least resistance. We don’t want to speculate on the election, but we would opine that Mike Pence did a great job last night and Kamala Harris, albeit a suitable opponent, she didn’t come with the enthusiasm and demeanor she needed to in order to sway weak opinions of her running mate Joe Biden. Look we won’t get into politics, but rather their stark differences in policy are very clear and America will have to decide which way it sees itself moving forward.
Anyway onto the technical side of the markets, we took a peek at Google which was down 19% off the highs and is now trading around the $1500 level and running into the 50eMA once again. Will this put the bulls in check on this bounce? We have outlined a trend channel which we feel defines this H&S topping pattern and point out that the topping process would be negated with a close above $1515. However with all the anti-trust rhetoric flowing, something Magnelibra has been talking about for years, taking flak for doing so mind you, but in reality these tech companies hold and wield far too much information and power:
As far as the SP500 the fib .618 is nearby and should bring in some profit takers on this rally, remember we go up and down and buying into highs doesn’t make good long term sense, patience does, but you have to be ready to pull the trigger!
The Nikkei as we have pointed out when it broke above $23k that technically it is shaping up to outpace the other indexes and may usher in a new Bull era, the dip briefly below this level back in September was a gift and but now we may be a bit too far from the sticky 50eMA down at 23400:
As we pointed out earlier USG 10Y yields are down slightly today, but to put this in perspective, yields have risen some 56% or 27 basis points off the August lows and are currently running into the .618 themselves at 0.782% yield:
OK, we will be back with more later!
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