Stocks: Markets cheer tech deals

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NEW YORK (CNNMoney)

With two deals set to transform the technology industry, traders saw reasons for optimism coming back after the summer stock market doldrums.

In the second-biggest merger ever, Verizon (VZ, Fortune 500) said it will pay $130 billion to take full control of Verizon Wireless, and Microsoft (MSFT, Fortune 500) said it was buying Nokia's (NOK) mobile phone business for $7.2 billion.

Takeover Tuesday helped pushed the Dow, S&P 500 and Nasdaq up between 0.5% and 1.2%.

Click here for more on stocks, bonds, commodities, and currencies.

However, investors had some reasons to remain wary, following reports of a ballistic missile launch in the eastern Mediterranean region, which revived concerns about a U.S.-led strike on Syria.

Israel's Ministry of Defense confirmed that Israeli forces and the U.S. Missile Defense Agency had carried out a missile test and said Israel would release further information about the launch soon.

European markets dipped slightly, while Asian markets ended between 1% and 3% higher.

Related: Wall Street is asleep: Volume at 5-year low

Manufacturing data in the U.S. came in above expectations, after better-than-expected manufacturing data was released in Europe and Asia over the long weekend.

Related: Fear & Greed Index

Buyers losing out: Investors didn't reward the two big buyers in the M&A market on Tuesday.

Shares of Microsoft dropped more than 4% following the deal, while Nokia's shares soared.

Verizon's stock dropped roughly 4% following the buyout.

End of cable drama: Investors like the agreement between Time Warner Cable (TWC, Fortune 500) and CBS (CBS, Fortune 500) to end a month-long blackout and restore CBS programming to about 3 million viewers, with both stocks rising.

First Published: September 3, 2013: 9:47 AM ET

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Scientists laid off due to budget cuts

These two will lose their job next month at Arkansas State University due to forced spending cuts. They were among 30 jobs lost, because of defense funding cuts for their work detecting bombs. They were given plaques for their service on Friday.

WASHINGTON (CNNMoney)

Nearly half of the recipients who get federal science funding say they've recently laid off or will lay off scientists and researchers, because federal grants are tougher to win, according to a survey by the American Society for Biochemistry and Molecular Biology and 15 other scientific societies.

At Arkansas State University, 30 scientists and researchers have lost or will lose jobs by October from federal budget cuts at the defense and education departments that funded research detecting bombs and nerve agents.

Related: Defense furloughs cause surgery delays

At the University of Chicago, 3 laboratories have closed, costing six medical researchers jobs treating cancer, healing wounds and gastro-intestinal problems, due to funding cuts at the National Institutes of Health.

These are just some of the cuts underway thanks to $85 billion in forced spending cuts, called sequester, that kicked in March 1. And as more research grants don't get renewed, the layoffs will get worse, experts say.

"My post-doctoral student is facing losing a job in coming months if no new NIH funding comes in," said Professor Yuntao Wu at George Mason University's National Center for Biodefense and Infectious Diseases and the Department of Molecular and Microbiology.

Wu has already laid off one technician at his lab, which works with a compound derived from soybeans to treat HIV. "We are facing closing the whole lab. That takes many years to build," he added.

Some 1,444 of 3,165 scientists reported layoffs are imminent or have taken place at their laboratories, because they couldn't renew federal grants.

About 54% of scientists reported that they know a colleague who has lost a job, according to the survey. The questionnaires went out in June and July.

The layoffs were first signaled months ago by Francis S. Collins, director of the National Institutes of Health. He warned earlier this year that the sequester would eventually cost 20,000 research and technician jobs.

Related: Key blood research at risk from cuts

The NIH has lost $1.6 billion from its $31 billion budget in its fiscal year that ends Sept. 30, on top of tighter budgets in 2012 and 2011. The NIH is the largest supporter of biomedical research in the United States, and cuts have led to hundreds of research projects not getting funding.

The National Science Foundation also has said 1,000 fewer grants would be awarded this year, compared to last year. NSF funds research and education in non-medical science and engineering.

The Department of Defense has also cut research funding in its quest to trim $40 billion from its budget by Sept. 30.

Scientists and lobbying groups say the funding climate endangers a generation of future scientists and breakthroughs.

"The data shows that deep cuts to federal investments in research are tearing at the fabric of the nation's scientific enterprise and have a minimal impact on overcoming our national debt and deficit problems," said Benjamin Corb, spokesman for the biochemistry group.

First Published: September 3, 2013: 6:07 AM ET

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Funds fit for teenage investors

NEW YORK (Money Magazine)

"At that stage in life, $1,400 seems like all the money in the world," says financial planner Tim Maurer, co-author of The Ultimate Financial Plan. So don't risk big losses that could scare her away from the market forever.

A balanced fund -- one holding both stocks and bonds -- should provide smoother growth than pure stocks.

Related: Money 70 - Best mutual funds

A good pick: Vanguard Star (VGSTX) , which comprises 11 Vanguard funds and holds everything from international stocks to short-term bonds. The minimum buy-in is $1,000 -- unlike many other funds, low enough for your situation.

Related: When should I dump an underperforming fund?

While Maurer terms Star relatively safe, your daughter can cut her risk further by putting some of her cash in a money-market fund instead.

First Published: September 3, 2013: 6:10 AM ET

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China Everbright fined for insider trading

Everbright Securities shares dropped 10% Monday as investors reacted to new fines and penalties.

HONG KONG (CNNMoney)

The state-controlled company will be forced to pay a 523 million yuan ($85.5 million) fine, and regulators say Everbright has been banned indefinitely from trading on its own account.

Everbright is able to continue trading fixed-income securities, but the company is prohibited from applying for new business. The government didn't specify if it would consider allowing the firm to engage in proprietary trading at a future date.

In addition, four executives have been fined 600,000 yuan, and barred from the securities market for life, while another was fined 200,000 yuan.

Two of the punished executives have since resigned, including assistant president Yang Chizhong and board secretary Mei Jian, according to a company statement to the Shanghai Stock Exchange.

Everbright president Xu Haoming stepped down earlier in the middle of the government investigation.

News of the securities watchdog's fines caused shares of Everbright Securities to tumble 10% at market open on Monday, the daily limit allowed on the Shanghai Stock Exchange.

The China Securities Regulatory Commission began investigating Everbright after a systems glitch bombarded the market with erroneous buy orders on Aug. 16, sending the Shanghai Composite Index up by 6% in a matter of minutes.

After realizing its mistake, Everbright tried to fix the error by taking short positions in index futures and exchange-traded funds, even turning a profit of 87.2 million yuan before disclosing the computer systems gaffe, according to the government.

Everbright's trades constituted insider trading, violated stock exchange regulations, and caused great negative impact to public investors, the CSRC said. The government will confiscate the millions in profit, in addition to the fines levied.

The company could appeal to the CSRC, but hasn't said whether it will do so, according to a company statement.

Everbright's gaffe, the largest such incident in the history since China's capital markets were established, have raised questions over effective regulation and the use of high-speed trading platforms on the exchange.

Related story: Fat fingers in Shanghai shake investor confidence

Computer trading systems glitches are common in markets around the world, Robert Horrocks, chief investment officer at Matthews Asia, said before the CSRC announced the Everbright fines.

"The nature of the error tells you a little bit about how the market has developed over time," he said. "And to me, the nature of this error tells me that the markets have developed a wee bit and gotten more complex and sophisticated."

Last month, computer malfunctions caused a trading halt in all Nasdaq-listed stocks and options for more than three hours. In April, the Dow quickly plunged 140 points after hackers managed to send an incorrect tweet about an emergency at the White House. And in 2010, the Dow Jones industrial average plunged nearly 1,000 points, briefly erasing $1 trillion in market value

First Published: September 2, 2013: 1:28 AM ET

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Vodafone nears $130 billion deal with Verizon

HONG KONG (CNNMoney)

The deal, valued at $130 billion, would give Verizon 100% control of Verizon Wireless if completed. Vodafone (VOD) currently owns 45% of the venture.

Vodafone cautioned that there is no guarantee that an agreement will be reached, but said that the deal would consist of a mixture of Verizon common stock and cash.

"A further announcement will be made as soon as practicable," the company said in a statement. Verizon declined to comment.

If completed, it will be one of the largest deals in corporate history. Vodafone paid a record $180 billion for Germany's Mannesmann in 2000.

Verizon (VZ, Fortune 500) has expressed desire in controlling all of Verizon Wireless for years, but rumors that such a deal was about to get done have increased over the past few months.

Verizon Wireless is the most profitable U.S. wireless carrier, and Verizon wants total access to that firehose -- not just 55% of it.

The wireless business is the only reason the company is growing: Landlines are dying, and Verizon has stopped building out its FiOS Internet and television infrastructure.

Related story: Vodafone's $10 billion German takeover

The British company could use the proceeds to pay down debt. It may also return a substantial portion to shareholders.

Vodafone's possible exit from the U.S. comes as the telecoms group deepens its presence in Europe. In June, Vodafone outbid Liberty Global and paid $10.1 billion to buy German cable operator Kabel Deutschland. That purchase should allow it to continue growing in the German market by cross-selling TV and broadband services to its existing customers.

The deal comes at a time of consolidation for the wireless industry. MetroPCS and T-Mobile (TMUS) recently completed their complex merger, and Softbank bought Sprint (S, Fortune 500) in July.

First Published: September 2, 2013: 12:14 AM ET

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World stocks rally on upbeat economic reports

European and Chinese manufacturing activity is picking up, according to new surveys, boosting stock markets such as Germany's DAX.

LONDON (CNNMoney)

A slew of manufacturing data spread positive sentiment across Europe and added to recent signs that the eurozone is building a sustained recovery from its longest ever recession.

Encouraging news from China also helped. A rise in manufacturing output -- with two separate readings showing improvement in August -- threw positive light on the outlook for the global economy.

Steadying growth in China's vast manufacturing sector, seen as an economic bellwether, could ease the pressure on the Chinese government to launch more significant stimulus measures.

A euro zone reading of manufacturing output rose for the fourth consecutive month in August, according to data from Markit.

The result was helped by a strong improvement in German manufacturing conditions, rising to their highest level in more than two years, as export demand rebounded.

But perhaps more encouraging was the data emerging from Europe's struggling peripheral economies. Manufacturing grew at its fastest pace in more than two years in Italy and Spain, and Greece too showed signs of life in its factory sector.

Related: Europe's recovery gains momentum

London's FSTE 100 traded up 1.6%, Germany's DAX and France's CAC jumped 1.7% in morning trading. Hong Kong's Hang Seng closed up 2%.

The strength in European and Asia markets could support a positive start for U.S. stocks when markets reopen Tuesday after the Labor Day holiday. S&P futures were trading up nearly 1.0%.

Economists said the pick-up in activity in peripheral Europe indicated the most distressed parts of the currency bloc are beginning to heal.

"The return to growth at the periphery will make all debt sustainability calculations look much better," said Holger Schmieding, chief economist at Berenberg.

Related: Stocks: Jobs, Syria in focus

The widespread improvement in manufacturing conditions throughout Europe follows better-than-expected euro zone GDP growth of 0.3% in the second quarter.

Corporate news also boosted the London market as index heavyweight Vodafone (VOD) prepared to ink one of the largest deals in corporate history. Vodafone is set to announce it will sell its 45% stake in Verizon Wireless to its U.S. joint venture partner Verizon Communications In (VZ, Fortune 500)c for $130 billion.

The strong start to the month comes after major indexes recorded monthly losses in August. But the likelihood of military action in Syria, combined with expectations that the Federal Reserve will begin the process of reducing its program of quantitative easing, are likely to mean further volatility in September.

First Published: September 2, 2013: 7:45 AM ET

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India's economic growth slowest since 2009

India's GDP growth hit is lowest level since the beginning of 2009.

LONDON (CNNMoney)

The nation's gross domestic product -- the broadest measure of economic growth -- came in at 4.4% annual rate for the April to June quarter.

That's India's lowest quarterly growth since the beginning of 2009, heightening concerns about a nation that is struggling with a falling currency, dysfunctional politics and a highly volatile stock market.

"This number is a little bit lower than consensus expectations, but expectations were quite low to begin with," said Anjalika Bardalai, a senior analyst at Eurasia Group in London.

Growth in the January to March quarter was also sluggish, at 4.8%. The most recent International Monetary Fund report forecasts that India's economy will expand by 5.6% in fiscal 2013, but many economists believe that number is overly optimistic.

Related: Emerging market woes: Contained or contagion?

The GDP data was released just hours after the country's prime minister, Manmohan Singh, said "the fundamentals of the Indian economy continue to be strong," while acknowledging that India faced "a difficult economic situation."

The Indian rupee has lost roughly 12% of its value during the past month, with much of it coming in a series of stomach-churning drops during the past few days. The sharp currency devaluation is extremely problematic since the country imports many more goods than it exports. That could leave consumers struggling to pay higher prices for everyday goods.

Equity markets have also taken a big hit in recent days. The benchmark Mumbai Sensex index has quickly turned into one of the worst performers in Asia.

The government has responded with a series of policy changes, but none have been particularly effective in stabilizing the recent volatility.

Economists have long argued that India needs to implement structural economic reforms to bring about meaningful progress. Last year, parliament lifted restrictions on foreign direct investment after much debate -- a key step.

But Eurasia's Bardalai said India is simply not making enough progress with its economic reforms, and that's hurting the country's future prospects.

Meanwhile, time for making bold new reforms is running out, with national elections due to take place by May 2014.

--CNNMoney's Charles Riley contributed to this report.

First Published: August 30, 2013: 11:25 AM ET

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China partners with U.S. oil firm in Egypt

NEW YORK (CNNMoney)

The deal involves Sinopec (SHI) paying $3.1 billion for a 33% stake in Apache's Egyptian operations, which produce about 100,000 barrels of oil day.

Apache (APA, Fortune 500) said the sale had nothing to do with the current turbulence in Egypt.

"Apache's exploration and production operations, which are located in remote, unpopulated areas, remain unaffected by political events in the region," the company said in a statement announcing the deal.

Instead, Apache said it will use the money to focus on "assets with predictable growth rates and attractive rates of return" -- primarily oil fields in West Texas, the Texas Panhandle, and Oklahoma.

Related: Oil companies target America for investment

Apache is the latest in a string of oil companies that have been selling assets overseas, including $11 billion in sales from ConocoPhillips (COP, Fortune 500) and $4 billion from Hess (HES, Fortune 500) in 2012.

Much of the money is being invested in U.S. states including Texas, North Dakota and Pennsylvania, where hydraulic fracturing and advances in drilling have unlocked previously inaccessible oil and gas supplies and led to a boom in U.S. energy production.

Analysts say the firms are attracted to the relatively well developed infrastructure in the United States, well trained workers, strong laws and low tax rates. Royalties, income and other taxes in the United States typically take about 50% of an oil company's profit, compared to 90% or more in many other parts of the world.

China's expansion: For the Chinese, the deal is yet another in a series of partnerships Chinese oil firms have struck with Western companies as China seeks to secure additional supplies for its rapidly expanding economy and gain knowledge of cutting edge industry technology.

Other large Chinese deals this year include a $4.1 billion purchase of an offshore gas field in Mozambique from Italy's Eni (E), a $1.7 billion partnership with Texas-based Pioneer (PXD) on fields in that state, and a $1.5 billion deal for offshore assets with Brazil's Petrobras (PBR), according to Brian Lidsky, an analyst with energy data provider PLS in Houston.

Chinese firms often come in as a junior partner, putting up some cash in exchange for a minority stake in the oil fields. The fields themselves remain operated by the majority investor, although Chinese engineers are often on site.

Chinese investment in U.S oil fields remains a sensitive issue in the United States, with some fearing the involvement of firms controlled by a not-always-friendly government in such a strategic resource. In 2005, the U.S. government effectively blocked the sale of California's Unocal to China's CNOOC.

Yet others say greater Chinese investment in the oil industry is a good thing. Oil is, after all, a global commodity. If China is going to continue using so much oil, the more everyone will have to pay. So its firms might as well put up the money, and assume some of the risk, to get the stuff out of the ground.

First Published: August 30, 2013: 11:38 AM ET

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American, US Air win quick trial for antitrust case

US Airways and American Airlines won their request for a quick trial in the antitrust case that seeks to block their proposed merger.

NEW YORK (CNNMoney)

U.S. District Court Judge Colleen Kollar-Kotelly on Friday set a Nov. 25 trial date, which was only two weeks after the airlines' requested trial date. The case will be a bench trial, not a jury trial, at the courthouse in Washington.

The Justice Department had asked for a March trial date for the antitrust case it filed in mid-August. But attorneys for US Air and American had said such a delay would threaten the deal itself because they could not wait that long to know if they could go ahead with the combination.

"Two independent companies can be asked to stay in limbo for only so long before they need to make independent plans," said the airline in a filing on Wednesday.

The airlines said they were pleased with Friday's decision and confident they will win the court's approval of the merger.

Justice Department spokesman Peter Carr said "We appreciate the court's careful consideration of the scheduling issues and will be ready to present our case on Nov. 25, 2013."

Shares of US Air (LCC, Fortune 500), which have lost ground since the antitrust case was brought, rose 2% in Friday trading.

Related: Questions about price hikes surround American-US Airways deal

Justice filed the antitrust suit earlier this month, charging the combination would hurt airline passengers by reducing choices and driving up costs. The airlines argue the $11 billion merger of their two networks announced in February would give customers more choices and reduce overall costs, and would spur competition.

Justice contends that American Airlines' financial turnaround since its November 2011 bankruptcy filing, including the posting of its largest monthly profit on record in July, is proof that the airlines could survive as independent carriers.

First Published: August 30, 2013: 2:28 PM ET

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India's economic growth slowest since 2009

India's GDP growth hit is lowest level since the beginning of 2009.

LONDON (CNNMoney)

The nation's gross domestic product -- the broadest measure of economic growth -- came in at 4.4% annual rate for the April to June quarter.

That's India's lowest quarterly growth since the beginning of 2009, heightening concerns about a nation that is struggling with a falling currency, dysfunctional politics and a highly volatile stock market.

"This number is a little bit lower than consensus expectations, but expectations were quite low to begin with," said Anjalika Bardalai, a senior analyst at Eurasia Group in London.

Growth in the January to March quarter was also sluggish, at 4.8%. The most recent International Monetary Fund report forecasts that India's economy will expand by 5.6% in fiscal 2013, but many economists believe that number is overly optimistic.

Related: Emerging market woes: Contained or contagion?

The GDP data was released just hours after the country's prime minister, Manmohan Singh, said "the fundamentals of the Indian economy continue to be strong," while acknowledging that India faced "a difficult economic situation."

The Indian rupee has lost roughly 12% of its value during the past month, with much of it coming in a series of stomach-churning drops during the past few days. The sharp currency devaluation is extremely problematic since the country imports many more goods than it exports. That could leave consumers struggling to pay higher prices for everyday goods.

Equity markets have also taken a big hit in recent days. The benchmark Mumbai Sensex index has quickly turned into one of the worst performers in Asia.

The government has responded with a series of policy changes, but none have been particularly effective in stabilizing the recent volatility.

Economists have long argued that India needs to implement structural economic reforms to bring about meaningful progress. Last year, parliament lifted restrictions on foreign direct investment after much debate -- a key step.

But Eurasia's Bardalai said India is simply not making enough progress with its economic reforms, and that's hurting the country's future prospects.

Meanwhile, time for making bold new reforms is running out, with national elections due to take place by May 2014.

--CNNMoney's Charles Riley contributed to this report.

First Published: August 30, 2013: 11:25 AM ET

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