Mergers and related efforts have the bulls enjoying the wind at their back in Thursday’s first half. As of 10:45 ET the SPYder” (SPY) and “Cubes” (QQQQ) are up .35% to .50% on mixed expiration-related participation.

For the bulls coping with Wednesday’s late cop out, it’s all about machinations and fingers crossed within the universe of M&A land. General Electric (GE) is possibly bringing good things to shareholders. The company is mulling the idea of auctioning off its appliances unit, which should result in a $5B to $8B payday and is a welcome prop for the M&A crowd. After a slight bit of out-the-gate cheering, shares of GE are off .10 at 32.40.

Elsewhere in investment banking circles, CBS Corp (CBS) announced it’s acquiring CNet Networks (CNET) for $1.8B in an effort to boost its world wide web thingamajiggy. Shares of CNET are up 3.47 at 11.42. Separately, what’s a day without news of who’s doing what to whom in Yahoo (YHOO)? Maybe one day we’ll find out, just not today. The latest from or about Yahoo is news of “activist investor” i.e. green-mailer Carl Icahn seeking antitrust clearance in order to purchase an additional $2.5B in shares of the somewhat hapless internet giant.

After acquiring 59 million shares of YHOO during the past ten sessions, the move by Mr. Icahn is part of an attempt to take on Yahoo’s board. The activist investor claims those folks “acted irrationally and lost the faith of shareholders” when it dismissed Microsoft’s (MSFT) $33 per share offer. Per this observer, it looks like our activist investor may have been a bit too active too soon and is now exploring other options that neither you nor I have access too. Shares of YHOO are up .35 at 27.49 and filling a painful reminder on the daily chart.

On the economic front, three data points came in slightly weaker than expected but not so much as to cause any price grievances and shifts towards a more negative crowd psychology. I guess investors could say the latest information isn’t the greatest, but neither is it “recession bad.” Weekly claims were up by 6,000 at 371,000 and just above views of 370,000. A regional survey on manufacturing conditions via New York’s Empire Index fell to -3.2 versus estimates for a flat reading. Separately, industrial production was expected to show a .3% decline for April after a .3% increase in March. Actual data showed a slip of .7%, while the utilization rate fell slightly below views at 79.7%.

Inflation is on the rise again, if we’re looking at crude realities other than government-sponsored data. The US Oil Fund (USO) is up 1.15 at 101.37 and has effectively reversed Wednesday’s response by bulls. Yesterday the commodity was pressed lower on profit-taking triggered by (so they tell me) a larger-than-expected build of distillate stocks which eased concerns over the related heating oil futures market. Thursday’s about face is apparently tied to a bit of weakness in the US Dollar and as likely, demand outstripping supply in the trading pit. Equity traders appear unfazed thus far, as the influential energy complex (XLE, OIH) is going along for the ride technically and providing investor satisfaction in the process.

And finally, in growth stock news or dare I say “sponsorship” news, shares of Woodward Governor (WGOV) are being well-covered by IBD, but pimped and poked through the “proper buy point” of 35.83 by CNBC’s Mad Money. Last night, the “now” higher-ranked provider / manufacturer of wind-power systems received a hot air plug from the fore-mentioned as a “wind-win” situation. Shares of WGOV are up 3.09 at 37.73 and 5.3% above the perfect and non-attainable buy point from a weekly cup with handle base. Stocks below the radar but also finding a gentle wind at their backs are names like Zoltek (ZOLT); a past Cramerica special, and Hexcel (HXL).     

Chris Tyler
Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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The information offered here is based upon Christopher Tyler’s observations and strictly intended for educational purposes only, the use of which is the responsibility of the individual. 

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