Why Unilever Stock Rose as Much as 10% Today

Shares of Europe's Unilever (NYSE: UL) rose as much as 10% on Jan. 19, a day after the stock opened 10% lower. That steep price decline and the rise today are both related to the same issue -- except the consumer goods and food-maker's direction on the issue changed. Investors were clearly pleased with management's updated point of view.

You can't talk about the price increase today without first talking about the price decline yesterday. Basically, news leaked that Unilever was looking to buy GlaxoSmithKline's (NYSE: GSK) consumer-healthcare business, which sells over-the-counter products like Advil, Sensodyne, and TheraFlu. The offer price was rumored to be around $68 billion, which many industry watchers considered expensive.

That offer was rebuffed by GlaxoSmithKline, but the fear among investors appeared to be that Unilever would up the bid. An increased offer would likely have been a financial stretch for Unilever. Thus, the stock fell.

Source Fool.com