Tech stocks led the Nasdaq higher on Monday, but some big merger news didn't have the impact you might expect. The Dow Jones industrial average (^DJI) gained 20 points, the Standard & Poor's 500 index (^GPSC) added 7, and the Nasdaq composite (^IXIC) rose 35 points.
Apple (AAPL) and Google (GOOG), two of the biggest contributors to the Nasdaq, each gained more than 1 percent. The two companies agreed over the weekend to dismiss patent lawsuits against each other. Neither company scores a big "win," but they both remove some uncertainty overhanging their shares.
Facebook (FB) rose 2 percent, Netflix (NFLX) gained 4 percent and TripAdvisor (TRIP) jumped 5 percent each. Cyber-security firm FireEye (FEYE) rose 4 percent on upbeat product comments from a well-known tech analyst at Nomura. And Gogo (GOGO) gained 5½ percent after UBS raised its rating on the in-flight Internet company's stock to "buy" from "neutral."
On the merger front, AstraZeneca (AZN) slid 12 percent after rejecting Pfizer's (PFE) sweetened takeover bid. Pfizer added less than 1 percent. Shareholders may think the company can find a better way to spend more than $120 billion. One impetus behind the Pfizer bid is a plan to move its headquarters to Great Britain to lower its corporate tax rate.
That idea -– known as a tax inversion -- could be the motivation behind Walgreen's (WAG) expressed interest in buying out privately held Alliance Boots. Walgreen shares rose 3 percent. It already owns a 45 percent stake in the British pharmacy chain.
AT&T (T) fell 1 percent after officially announcing its $48.5 billion deal to take over DirecTV (DTV), which lost 2 percent, mostly because the acquisition was widely expected, and its approval was already baked into their stock prices. DirecTV shares have run up 30 percent over the past six months. But rival satellite TV provider Dish Network (DISH) give up early gains to end 1 percent lower, despite reports it, too, could become a takeover target, with Verizon (VZ) mentioned as a potential suitor.
Also feeling the fallout from the AT&T deal was American Movil (AMX), which fell 4 percent. AT&T plans to sell its substantial stake in the Mexican telecom company to help fund its purchase of DirecTV.
Finally, Johnson Controls (JCI) rose more than 4 percent on its plan to spinoff auto interiors business.
What to Watch Tuesday:
These major companies are scheduled to release quarterly financial statements:
After Market: Tech Giants Make Peace; AT&T Makes a Deal
"Your daily habits and routines are the reason you got into this mess," writes Trent Hamm, founder of TheSimpleDollar.com. "Spend some time thinking about how you spend money each day, each week and each month." Do you really need your daily latte? Can you bring your lunch to work instead of buying it four times a week? Ask yourself: What can I change without sacrificing my lifestyle too much?
Remove all credit cards from your wallet and leave them at home when you go shopping, advises WiseBread contributor Sabah Karimi. “Even if you earn cash back or other rewards with credit card purchases, stop spending with your credit cards until you have your finances under control,” she writes.
If you do a lot of online shopping at one retailer, you may have stored your credit card information on the site to make the checkout process easier. But that also makes it easier to charge items you don't need. So clear that information. "If you’re paying for a recurring service, use a debit card issued from a major credit card service linked to your checking account," Hamm writes.
Reward yourself when you reach debt payoff goals. "The only way to completely pay off your credit card debt is to keep at it, and to do that, you must keep yourself motivated," Bakke writes. Just make sure to reward yourself within reason. For example, instead of a weeklong vacation, plan a weekend camping trip. "If you aim to reduce your credit card debt from $10,000 to $5,000 in two months," Bakke writes, "give yourself more than a pat on the back."
“Establish a budget,” writes Money Crashers contributor David Bakke. “If you don't scale back your spending, you'll dig yourself into a deeper hole." You can use personal finance tools like Mint.com, or make your own Excel spreadsheet that includes your monthly income and expenses. Then scrutinize those budget categories to see where you can cut costs.
Sort your credit card interest rates from highest to lowest, then tackle the card with the highest rate first. "By paying off the balance with the highest interest first, you increase your payment on the credit card with the highest annual percentage rate while continuing to make the minimum payment on the rest of your credit cards," writes Mint.com spokeswoman Hitha Prabhakar.
To make a dent in your debt, you need to pay more than the minimum balance on your credit card statements each month. "Paying the minimum -– usually 2 to 3 percent of the outstanding balance -– only prolongs a debt payoff strategy," Prabhakar writes. "Strengthen your commitment to pay everything off by making weekly, instead of monthly, payments." Or if your minimum payment is $100, try doubling it and paying off $200 or more.
If you have a high-interest card with a balance that you’re confident you can pay off in a few months, Hamm recommends moving the debt to a card that offers a zero-interest balance transfer. "You’ll need to pay off the debt before the balance transfer expires, or else you’re often hit with a much higher interest rate," he warns. "If you do it carefully, you can save hundreds on interest this way."
Have any birthday gifts or old wedding presents collecting dust in your closet? Look for items you can sell on eBay or Craigslist. "Do some research to make sure you list these items at a fair and reasonable price," Karimi writes. “Take quality photos, and write an attention-grabbing headline and description to sell the item as quickly as possible." Any profits from sales should go toward your debt.
If you receive a job bonus around the holidays or during the year, allocate that money toward your debt payoff plan. "Avoid the temptation to spend that bonus on a vacation or other luxury purchase," Karimi writes. It’s more important to fix your financial situation than own the latest designer bag.