Canadian Pacific Goes After Kansas City Southern

The stock market is having a good morning, and it’s tech stocks that are doing the best. The S&P 500 is still not far from its all-time high.

The big news this weekend is that Canadian Pacific (CP) is offering $275 per share for Kansas City Southern (KSU). That’s a 23% premium, which is a hefty offer. KSU is up this morning, but only by about 12%. That reflects some concerns over whether the deal will go through. The deal is in cash and stock and works out to $29 billion.

Today’s existing-home sales report dropped by 6.6% compared with January but was still up over 9% compared with last February. The big news is that housing inventory is low. I mean, really low.

Despite being on the cusp of the historically busy spring housing market, homeowners are not listing their properties for sale at the pace they normally would at this time of year. The supply of homes for sale fell 29.5% year over year, the largest annual decline ever, to 1.03 million homes.

At the current sales pace, it would take two months to exhaust this supply. One year ago, there was a three-month supply, which is also considered low.

The Turkey ETF (TUR) is down close to 20% today. The markets are reeling after Erdogan fired his third central bank head in two years. He had been hiking rates in order to defend the lira. Now that’s undone. The lira is getting wrecked in today’s trading.

Posted by on March 22nd, 2021 at 11:13 am


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