Responding to a diving stock market, high-tech companies such as Microsoft and Red Hat Software are buying back large amounts of their own shares. Microsoft has been pretty quiet about the plan, but with more than $30 billion in cash and a directive from stockholders to buy back stock at the company's discretion, the company is in a good position to help keep the stock price from tanking.
"It is reasonable for people to expect that we're participating in buyback efforts to support the economy and the financial markets," a Microsoft spokesperson verified yesterday.
Meanwhile, Red Hat, which makes the leading Linux distribution, announced this week that the company will buy back as much as 10 percent of its stock during the next year. As Microsoft and most other high-tech firms were, Red Hat was hit hard when financial markets reopened yesterday. Last Friday, the US Securities and Exchange Commission said that it would temporarily ease stock repurchase restrictions, making such tactics more feasible.