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Art Cashin: Why M&A Bump Is Bullish for Stocks

Monday, 23 Aug 2010 | 10:19 AM ET

Stocks rose Monday morning, as investors moved back into the market after some signs of new merger and acquisition activity. Art Cashin, director of floor operations at UBS Financial Services, discussed his outlook.

Word on the Street
Insight on the morning markets, with Cort Gwon, Trading Strategies and Research FBN Securities, and Art Cashin, UBS.

“I think we do have a couple of things working for the bulls,” Cashin told CNBC.

Potential acquisitions are a sign that companies are confident the economy will grow and business will improve in the coming quarters, he noted.

“The interesting thing about the sudden bump in mergers is that the acquirors tend to be using cash, which says: ‘I don’t want to use my stock for currency because I think my stock is undervalued,’ so that helps the [equity] bulls out,” Cashin said.

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Scorecard—What He Said:

  • Cashin's Previous Appearance on CNBC (Aug. 19, 2010)

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Market Views—Across the Board:

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CNBC Slideshows:

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CNBC Data Pages:

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Some Major M&A News:

BHP Billiton

Potash

AIG

  • AIG's ILFC Unit Repaid Nearly $4 Billion of US Loans

Hewlett-Packard

Dell

  • Hewlett-Packard Trumps Dell's Offer for 3Par

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Disclosures:

No immediate information was available for Cashin or his firm.

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Disclaimer

  Price   Change %Change
AFF
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BHP
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4331
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HPQ
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POT
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