Stock edge higher after Dubai gets $10B bailout, Exxon Mobil buys XTO EnergyBy Sara Lepro, AP
Monday, December 14, 2009
Stocks slightly higher after Dubai, Exxon deals
NEW YORK — Stocks edged higher Monday after a bailout of the troubled emirate of Dubai helped allay concerns that another wave of global credit problems might be on the way.
Investors were also encouraged by the latest evidence of a rebound in big corporate dealmaking. Exxon Mobil Corp.’s $31 billion purchase of XTO Energy sent energy stocks sharply higher. The deal will help Exxon tap into the growing supply of natural gas in the U.S. and could signal more consolidation in the energy industry.
Stocks were already rising early Monday on news that Abu Dhabi had extended $10 billion to Dubai to help the debt-strapped Middle Eastern city-state stay afloat. Markets had been worried in recent weeks that debt problems in the struggling boomtown could send ripples through global credit markets.
In other positive news, banking giant Citigroup Inc. said it would pay back $20 billion in bailout money it received as part of the government’s financial rescue program. The government will also sell its 34 percent stake in the company. The news came just days after Bank of America Corp. repaid the entire $45 billion in bailout money it owed U.S. taxpayers.
Despite the gain in stocks, investors were being cautious, refraining from making big bets in any one area of the market. Bond prices were little changed and commodities were just slightly higher.
A massive stock market rally that began in March has showed signs of slowing in recent weeks as investors take some money off the table and try to figure out how to position themselves in the new year. The Standard & Poor’s 500 index is up just 1 percent so far this month, after a 5.7 percent gain in November and a 63.5 percent gain since early March.
The Dow Jones industrial average rose 25.77, or 0.3 percent, to 10,497.27. The Standard & Poor’s 500 index rose 6.21, or 0.6 percent, to 1,112.62, while the Nasdaq composite index rose 14.54, or 0.7 percent, to 2,204.85.
Tags: Commodity Markets, Dubai, Exxon mobil, Middle East, New York, North America, United Arab Emirates, United States, Xto energy