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Two Ways: Pulte, Centex Join Hands


Strengthen your portfolio in good times and bad.

M&A Madness!

A surprise M&A announcement this morning: Pulte Homes (PHM) said it will acquire Centex Corp (CTX) in an all-stock deal worth $1.3 billion. Under the terms of the agreement, Centex shareholders will receive 0.975 shares of Pulte stock for each share they own. This would bring the value of Centex shares to $10.50, representing a 38% premium to yesterday's closing price.

Pulte president and chief executive officer Richard J Dugas, Jr said the combination allows the new company to capitalize on Centex's entry-level and move-up categories and Pulte's move-up and active adult segments. Further, Pulte will gain access to Centex's sizable holdings in both Texas and the Carolinas, 2 areas that continue to exhibit strength despite the housing downturn.

From the Bull Pen: Bulls can look elsewhere like Agnico-Eagle Mines (AEM). One can set a sell stop near $47-$48.

From the Bear Cave
: Real estate plays may get a lift from this announcement, but if you believe these stocks will need to retest their lows, consider a play in MDC Holdings (MDC); a buy stop can be set above $31.

Quick Check Around the World

Asian trading closed with the Hang Seng -3.04%, Nikkei -2.69%, India 1.97%, Shanghai -3.76% and Taiwan -2.39%.

Glancing towards Europe, we see the CAC -0.33%, DAX -0.50%, FTSE -0.66%

As of 8:00 AM EST, S&P Futures are trading -5 to 808.00, and Nasdaq futures are -0.25 to 1280.00.

A Look at Commodities

Over in commodities, crude oil is trading -1.06 to 48.09 while gold is +1.00 to 884.30 this morning. Silver is +0.100 to 12.220 and copper -1.50 to 197.50.

The dollar index is +0.045 to 85.7100.

On the Radar


07:00 MBA Mortgage Applications
10:00 Wholesale Inventories -0.6%
02:00 FOMC Minutes


Before: STZ, FDO, GBX

After: PBY, WDFC

Click here for the full trading radar.

Good luck today, Minyans!

In memory of our fallen friend and trusted colleague, Bennet Sedacca, 100% of the donations made to the RP Foundation through April will be channeled to philanthropic endeavors consistent with the RP mission, working closely with the Sedacca clan in the distribution of those funds. We thank you kindly for your support as we strive to effect positive change in the lives of children.
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No positions in stocks mentioned.

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