Final answer:
The stock market likely responded favorably to USX's stock split into separate steel and energy issues due to anticipated improvements in efficiency, potential growth, and increased attractiveness due to perceived affordability.
Step-by-step explanation:
The action of USX announcing a plan to split its stock into separate steel and energy issues was well received by the stock market for several reasons. Primarily, this move likely signaled to investors that the company was optimizing its business structure to enhance focus and performance in its different units. The increase in stock price by $2.37 to close at $31.25 may be attributed to investors anticipating more efficient operations, potential growth, and transparent financial reporting, leading to an increase in the value of their investments. The idea behind this positive reception is that separate entities can focus on their core businesses, thus potentially providing a better rate of return either through dividends or capital gains.
Moreover, a split stock may contribute to an enhanced perception of affordability, increasing attractiveness to a broader base of investors. The historical context of stock splits and corporate restructuring has shown that markets often view such moves favorably, anticipating positive future performance. Finally, the structure of a split can convey a message that a company seeks to maximize shareholder value for each of the distinct business operations, which can build investor confidence.