Stocks muted as Microsoft, Nuance deal and earnings in focus

How potential COVID 4th wave could impact markets

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U.S. stocks opened modestly lower as investors readied for the start of earnings season and took in a major deal from Microsoft. 

TickerSecurityLastChangeChange %
I:DJIDOW JONES AVERAGES33773.86-26.74-0.08%
SP500S&P 5004124.96-3.84-0.09%
I:COMPn.a.n.a.n.a.n.a.

The Dow Jones Industrial Average fell over 40 points, or 0.13%, while S&P 500 and Nasdaq Composite were lower by 0.35% and 0.11%, respectively. Both the Dow and the S&P finished at all-time highs on Friday as the Nasdaq escaped bear-market territory. 

In M&A news, Nuance Communications is being acquired by Microsoft in a $19.7 billion deal for the cloud and AI provider. The all-cash transaction will pay Nuance shareholders $56 per share, a 23% premium to Friday’s closing price. The deal is the second-largest for Microsoft, behind its $26 billion purchase of LinkedIn in 2016. 

TickerSecurityLastChangeChange %
NUANNUANCE COMMUNICATIONS, INC.53.55+7.97+17.49%
MSFTMICROSOFT CORP.255.40-0.45-0.17%

In addition, earnings season is set to kick off on Wednesday with big banks Goldman Sachs Group Inc., JPMorgan Chase & Co. and Wells Fargo & Co. set to release their quarterly results.  

TickerSecurityLastChangeChange %
JPMJPMORGAN CHASE & CO.156.74+0.35+0.22%
GSTHE GOLDMAN SACHS GROUP, INC.333.55+2.55+0.77%
WFCWELLS FARGO & CO.40.62+0.12+0.31%

Elsewhere, Uber Technologies Inc. reported gross bookings hit a record high in March as ride hailings snapped back to pre-pandemic levels and food delivery more than doubled from the previous year. 

TickerSecurityLastChangeChange %
UBERUBER TECHNOLOGIES, INC.59.60+1.91+3.31%
LYFTLYFT INC.61.14+0.17+0.28%

Meanwhile, Alibaba Group Holdings was fined a record 18 billion Chinese yuan ($2.75 billion) by Chinese regulators for anticompetitive behavior. However, the fine was smaller than feared.    

TickerSecurityLastChangeChange %
BABAALIBABA GROUP HOLDING LTD240.78+17.44+7.81%

In commodities, West Texas Intermediate crude oil climbed 81 cents or $60.13 per barrel and gold slipped $1.80 to $1,743 an ounce.

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Overseas markets were mixed. 

In Europe, Germany’s DAX 30 and France’s CAC 40 advanced 0.17% and 0.15%, respectively, while Britain’s FTSE 100 fell 0.31%. 

Asian markets were lower across the board with China’s Shanghai Composite index losing 1.09%, Hong Kong’s Hang Seng index declining 0.86% and Japan’s Nikkei 225 sliding 0.77%.  

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