Lehman Bros. raised $4 billion through the sale of covertible preferred shares to boost the markets higher during the midday with the Dow soaring 319 points to 12,581. Nasdaq leaped 66 points to 2345.
On the upside
CSK Auto (NYSE: CAO) agreed to be acquired by O'Reilly Automotive (Nasdaq: ORLY) in a cash and stock deal valued at approximately $500 million.
Goldman Sachs cut their price target for Citigroup (NYSE: C) and slashed their earnings guidance saying that the company is expected to write down $12 billlion in the first quarter. However, the stock price rose after both Lehman Bros. (NYSE: LEH) and UBS (NYSE: UBS) took significant write-downs.
On the downside
Jefferies & Co. analyst Daniel Furtado downgraded MCG Capital (Nasdaq: MCGC) after the commercial finance company failed to get a $200 million credit line renewed.
KKR Financial Holdings (NYSE: KFN) announced plans to sell 20 million shares of common stock through a public offering prompting a downgrade.
A Federal Aviation Administration investigation revealed that AAR (NYSE: AIR) improperly maintained landing gear parts used on a number of Boeing planes.
In the broad market, advancing issues outpaced decliners by a margin of more than 4 to 1 on the NYSE and by 5 to 2 on Nasdaq. The Russell 2000 which tracks small cap stocks leaped 16 points to 704.
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