Markets are humming today, and the Dow Jones Industrial Average (DJINDICES:^DJI) is flexing its muscles after some good news from the economic front. The Institute for Supply Management released its report this morning, showing that manufacturing activity expanded again in August, for the third month in a row, increasing to 55.7 over July's reading of 55.4. The Census Bureau also released data showing that residential construction spending increased in July by 0.5%, good news for the housing industry.

Big deals, big winners -- and losers
By midmorning, the Dow already had some big winners, as JPMorgan Chase (NYSE:JPM) and Bank of America (NYSE:BAC) lifted the banking sector with the news that the two financial giants landed a huge financing deal. Both banks will be participating in the $61 billion bridge loan that will finance the Verizon (NYSE:VZ) $130 billion acquisition of its 45% stake in Vodafone.

For the banks, the deal is win-win, since their participation in the huge 364-day bridge loan will net them some juicy underwriting fees. For Verizon, however, things are looking a bit grim. The stock has dipped more than 3.5% already today, some of which can be attributed to its announced $0.53 per share dividend yesterday. Still, the fact that it is still dropping might signal investor dismay with the purchase, along with concerns regarding Moody's downgrading of the company's debt based on the takeover news.

In other tech news, Microsoft (NASDAQ:MSFT) continues its downward spiral, losing more than 6% so far today. The announcement that it intends to buy Nokia's cellphone business for $7 billion isn't sitting well with analysts or investors -- particularly since part and parcel of the deal is the addition of Nokia's CEO Stephen Elop, formerly of Microsoft. Though Elop is resigning from Nokia's board to smooth the transition, he is regarded as a possible replacement for Steve Ballmer, who announced his retirement last month. Considering that Nokia's cellphone unit is facing decreased demand -- and that the company recently suffered a further downgrade from Moody's into junk status, due to its buyout of its Nokia Siemens partner -- investors have a right to be fretful.

As the day moves on, there may be some dips in the Dow, as investors begin to worry that the brighter economic news from the ISM and construction might push the Federal Reserve closer to tapering its current quantitative easing program.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.