What Does ICE Takeover Mean For The Future Of The NYSE?

2013-06-04 2

Shareholders of NYSE Euronext (NYX) approved an $8.2 billion takeover by the InterContinentalExchange (ICE) on Monday. ICE shareholders have also approved the merger. NYSE said it would release the preliminary results from its special meeting of shareholders on Tuesday.

Although the transaction still faces regulatory approvals in the U.S. and Europe, the results take the New York Stock Exchange one step closer to ending its 220 years of independent operation.

The next step is regulatory approval from the European Union, with an initial deadline of June 24 for the EU to rule on the deal. The combined company will be called IntercontinentalExchange Group, and the NYSE will be a subsidiary of the holding company. The new company’s stock would be listed on the New York Stock Exchange under ICE’s current stock symbol “ICE,” according to The Associated Press. 

All eyes are on Friday’s jobs report for May, released at 8:30am Eastern. The median forecast of economists surveyed by Dow Jones Newswires calls for nonfarm payrolls to be up 165,000 in May, unchanged from the 165,000 gain reported in April. The unemployment rate is expected to remain at 7.5%.

U.S. manufacturing activity contracted for the first time since November, according to a report released Monday by the Institute for Supply Management. The ISM monthly reading on the U.S. manufacturing sector came in at 49 in May, down from 50.7 in April. Any number below 50 indicates the sector is contracting. This was only the second time that the sector has shrunk since 2009.

Separate data on Monday revealed that the final reading of Markit's manufacturing PMI picked up in May from a six-month low in April; however, Markit said the PMI was consistent with only a modest rate of growth.

Other data showed that construction spending in the U.S. rose in April despite weakness in residential projects and government spending. Construction spending rose 0.4 percent in April, compared with March, when spending fell a revised 0.8%, the Commerce Department reported Monday.

Motor vehicle sales are reported on Monday. Ford Motor Company (NYSE: F) and Chrysler Group LLC reported U.S. sales gains in May that exceeded analysts’ estimates.

Ford reported that U.S. sales were up 14 percent compared to a year ago, while Chrysler’s sales increased 11 percent, its best may sales in six years.

Nissan Motor Co. also beat analysts’ estimates as sales rose 25 percent. Toyota Motor Corp. sales rose 2.5 percent, and General Motors Co. (NYSE: GM) gained 3.1 percent.