Yahoo Finance Senior Columnist Michael Santoli thinks the quick decline in bond prices recently is creating a chain reaction from those afraid of being left behind.
"The markets are feeding on themselves in terms of the selling," he says. "When we got this rapid move, stock investors, bond investors, everybody worried is somebody trapped, what's going on here, is too much leveraged money caught offside with a move like this. It seems as if a capital market shock of some nature is in place."
Meantime, investors are also reacting to a big acquisition this morning -- Verizon (VZ) buying AOL (AOL) for $4.4 billion or $50 per share in cash, more than $7 a share higher than AOL's closing price on Monday. The news sending AOL stock sharply higher.
Telecom analyst Roger Entner, founder of Recon Analytics, tells Yahoo Finance the move makes a lot of sense for Verizon.
"$4.4 billion is not that much money for Verizon to have exclusive control over a very good advertising platform," he argues. "On top of it, it gets content which may or may not be a good match for the company which it can always sell."
Santoli adds this deal is another example of how once disparate elements of the media industry are now coming together.
"Media companies and whatever screens they're serving, it's all kind of blurring," he notes. "If it's a phone, if it's a screen, if you're a cable company or a telecom company, it all kind of doesn't matter anymore. There are pipes leading to screens and they want to experiment with ways to serve content and ads across all of them."
Supermarket talks underway
Here’s a look at some of the other stocks the Yahoo Finance team will be tracking for you today.
Delhaize (DEG) shares are higher in early trading after the Belgium based firm confirmed it’s in talks with Royal Ahold about a potential $26 billion merger that could create one of the largest supermarket operators in the U.S. according to the Wall Street Journal. Both companies are based in Europe but generate about 60% of their sales in the U.S. Ahold operates supermarket chains such as Stop & Shop and Giant, while Delhaize owns Food Lion.
Rackspace (RAX) shares are falling ahead of the open. The cloud-based web hosting company reporting earnings that matched estimates, but revenue missed forecasts as the stronger dollar hurt sales growth. The company also cut its outlook for the current quarter.
Gap (GPS) shares are lower before the bell. The retailer reporting weaker-than-expected sales for April and the first quarter due -- again -- to the stronger dollar along with continued weakness in its namesake and Banana Republic brands. Gap is scheduled to report full first quarter results next week.
Zillow (Z) shares are also in the spotlight. The online real-estate marketplace is set to report first quarter results after the close of trading today. Analysts' are looking for the company to report a loss of $0.12 a share on revenue of about $136 million dollars.
McDonald's makes more changes
McDonald's (MCD) is announcing new plans to simplify its drive-thru menu and the chain is also bolstering its mid-priced food offerings. These moves come just one week after McDonald's announced a turnaround plan.