Microsoft Corporation (NASDAQ:MSFT) said it is buying Danish business software vendor Navision for $1.3 billion. Today's deal is similar to Microsoft's past purchase of Great Plains as it is buying entry into the small and medium-sized business market for software that involves tasks like financial and resource planning. Shares of Microsoft (MSFT) are edging higher at $49.06, up $0.44 from yesterday's close of $48.62. In overseas trading Navision's European rivals SAP (NYSE:SAP) $29.85 and Sage (UK:SGE) were lower in the wake of the announcement.
Productivity surges to 8.6% annual rate
First-quarter productivity at the nations factories surged to an 8.6% annual rate, handily outpacing economist's forecasts of 6.8%. The gain in productivity was the largest since the second period of 1983. Fourth-quarter productivity was revised higher to a 5.5% gain from 5.2%. Labor officials said Q1 unit labor costs fell 5.4%, the largest one-quarter drop since the second quarter of 1983.
The decline in unit labor costs shows in part that U.S. companies are slow to hire even as the economy tests its legs. Instead, the existing workforce worked harder in the first quarter. Some economists are expressing concern that softer wages could curtail spending in coming months. Limited pricing power has kept new hiring to a minimum and held salary increases in check for many industries.
The data shows that inflation risks remain contained so far and help support a widespread belief that the Fed will hold interest rates where they are, when the FOMC announced its decision on Fed Funds rates later today at approximately 2:15 PM EST.
Stock futures higher
Stock futures are trading higher this morning with S&P futures up 6.4 points at 1,058.20. NASDAQ futures are up 13 points at 1,178.50 and Dow futures are gaining 55 points at 9,845.
Fair value for the S&P 500 today is $0.60. That price will not change during the session. HL Camp & Company has their computers set for program buying at $1.52 and set for program selling at $-0.82. Fair value for the NASDAQ-100 today is $3.70.