Now that the American market in telecommunications has almost reached its saturation point, there are mergers and acquisitions about to take place that will effect telecom exchange traded funds (ETFs). As of Friday, AT&T (T)closed the purchase of its $86 billion deal with Bell South Corp. in an effort to widen their U.S. phone and Internet services. Julie Vorman of Reuters reported that AT&T is also attempting to break into television now that traditional phone services have thinned.
Verizon Communications Inc. (VZ) is seeking to buy a stake in India’s fourth largest mobile phone operator, Hutchison Essar Ltd. SmartMoney stated that other contenders for Hutchison Essar include Vodaphone Group PLC. and India’s own Reliance Communications Ltd.
Look for the ETF iShares Dow Jones U.S. Telecom (IYZ) to make the most of these events. Top holdings include AT&T with 23% and Verizon with 19%.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.