Following last week's approval from federal regulators, Capital One (COF, Financial) and Discover Financial Services (DFS) saw their stock prices rise on the first trading day this week. Shortly after the market opened, Capital One's shares increased by 3%, while Discover's shares jumped approximately 5%.
The approval, granted by the Federal Reserve and the Office of the Comptroller of the Currency, allows Capital One to acquire Discover, creating the largest credit card company in the United States. The Department of Justice is not expected to oppose the deal. Prior to the announcement, some analysts speculated that the government might not support the merger, so the news likely relieved investors, contributing to the positive market reaction.
This development suggests a favorable regulatory environment for corporate mergers, aligning with investor expectations following Donald Trump's reelection. The merger, initially announced last year, was valued at over $35 billion.
