The broader market and deal stocks gained on Wednesday, despite yet another increase in oil prices, as investors seemed more than satisfied with the Commerce Department's report of a 0.5% durable goods order drop for April. The order decline, which was far less than expected by experts, was driven primarily by the lagging automobile and aircraft sector. The Dow Jones Industrial Average ticked up 45.68 points to close at 12,594.03.
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On the Deal Stock front, Countrywide Financial Corp. jumped 8.5% to close at $4.98 per share on news that pending acquirer Bank of America Corp. said it plans to appoint Barbara Desoer, its current chief technology and operations officer, to run what will be its new combined mortgage operation. David Sambol, Countrywide's president and chief operating officer, who was originally slated to lead the merged business, will retire after assisting Desoer with the integration. In a regulatory filing on Wednesday, BofA said Countrywide stockholders will meet on June 25 to vote on the roughly $4 billion merger.
While the long awaited Bank of America-Countrywide deal inched one step closer to materializing, the merger of US Airways Group Inc. and UAL Corp. (United Airlines Inc. parent) reportedly may have taken a step back -- if you believe The New York Times. A Wednesday Times article said talks between the carriers appear to be on "permanent hold" due to worries about integration and soaring gas fuel costs, sending UAL's shares down 3.30% to $7.91 and US Airways down 8.11% to close at $4.08. However, after market close, The Wall Street Journal's Web site published a story refuting the Times' reporting.
New to the auction block on Wednesday was Learning Tree International Inc., which said that a special committee of independent directors decided to solicit offers for the company and that it has retained RBC Capital Markets as its financial adviser and Manatt, Phelps & Phillips LLP as legal counsel. Shares skyrocketed 8.23% to close at $17.75 per share. - Michael Rudnick
