(Boursier.com) — Wall Street hesitated on Monday, remaining feverish before the quarterly publications of technological ‘megacaps’, and while yields marked time on the bond markets. The S&P 500 dropped another 0.17% to 4,217 pts, the Dow Jones fell 0.58% to 32,936 pts, while the Nasdaq gained 0.27% to 13,018 pts, erasing its sharp opening drop. The news provided on mergers and acquisitions, especially an offer of 53 billion dollars of Chevron on his rival Hess, created a diversion. On the Nymex, a barrel of WTI crude fell 1.9% to $86. The dollar index returns 0.2% against a basket of currencies but Bitcoin accelerates to more than $34,000!
On the bond markets, the yield on the 2-year T-Bond reached 5.11% before relaxing a little, while the 10-year is approaching 5% – a yield at its highest since 2007 – and the 30 years evolves at more than 5%… According to the CME Group’s FedWatch tool, the probability is now more than 98% that the Fed will leave its rates unchanged between 5.25 and 5.5% on fed funds on the 1st november. The probability of a monetary status quo until the end of the year stands at almost 75% according to the same barometer.
The Chicago Fed’s national activity index for September 2023 came in at +0.02, compared to a market consensus of +0.05 and a level of -0.22 a month earlier, in data revised. This indicator therefore appears very slightly positive, which nevertheless signals an expansion ‘in line with the trend’.
The quarterly financial publication season accelerates this week on Wall Street. Cadence Design Systems And Brown & Brown announce their accounts this Monday evening.
Tomorrow Tuesday, Alphabet And Microsoft will be the two stars of the evening. Visa, Coca-Cola, Danaher, Texas Instruments, Verizon, General Electric, RTX, Chubb, Fiserv, Illinois Tool Works, HCA Healthcare, Waste Management, Sherwin Williams, 3M, Paccar, Kimberly Clark, General Motors, Archer-Daniels, Centene, Halliburton, Nucor, Dow Inc, Spotify, Corning, Snap Inc, PulteGroup Or Robert Halfwill also publish tomorrow…
Meta Platforms, IBM And ServiceNow will announce Wednesday evening. Thermo Fisher, T-Mobile US, Boeing, ADP, CME Group, General Dynamics, Equinix, Kla Corporation, Moody’s, O’Reilly Automotive, Roper Technologies, Hess, Norfolk Southern, Edwards Life Sciences, Hilton Worldwide, Baker Hughes, Otis Worldwide, Teradyne Or AvalonBaywill also reveal their latest results on Wednesday.
Amazon, Intel, Ford, Capital One Financial And Chipotle Mexican Grillwill publish Thursday evening. MasterCard, Merck, Comcast, UPS, Honeywell, Bristol-Myers, Altria, American Tower Corporation, Northrop Grumman, Boston Scientific, Valero, PG&E, Keurig Dr Pepper, Hershey, Newmont Or Royal Caribbeanwill also announce Thursday.
ExxonMobil, Chevron, AbbVie, Charter Communications, Colgate-Palmolive, Phillips 66, Imperial Oil, Xcel Energy, AutoNation, Newell Brands And Stanley Black & Deckerwill finally publish on Friday.
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Apple is stable, while the Chinese authorities have launched an investigation into its main production partner, the Taiwanese group Foxconn Technology, also one of China’s largest employers. Over the weekend, Chinese state media reported that regulators were conducting tax audits and examining land use by Foxconn, the Taiwanese company that makes the vast majority of iPhones at its factories in China. Hon Hai Precision Industry Co., Foxconn’s state-owned arm, said it would work with authorities. Yesterday, the Chinese newspaper Global Times reported that Foxconn subsidiaries in China were the subject of tax audits, with local authorities particularly interested in land use in the provinces of Hubei and Henan.
Reuters sources indicate that the investigation was made public for political reasons, in the run-up to the presidential election in Taiwan and as Foxconn seeks to diversify its production outside of China – in India in particular on behalf of Apple. According to one of the agency’s sources, Beijing’s unexpected audit would be a kind of warning to Foxconn…
The Wall Street Journal takes the opportunity to highlight the growing dependence onApple towards Foxconn’s rival Chinese group, Luxshare, against a backdrop of growing tensions between the United States and Beijing… Finally, Chinese e-commerce platforms would offer significant promotions on Apple’s iPhone 15 , which according to analysts would sell less well than the previous iPhone in the country, insists Reuters.
Chevron (-3.7%) announced the acquisition of its competitor Hess (-1%) as part of a monumental $53 billion stock deal. After the offer of almost 60 billion dollars ofExxonMobil (-1.4%) for the repurchase of Pioneer Natural Resources earlier this month, the American oil sector was once again agitated with a new major operation. Chevron is offering $171 per Hess stock, a premium of about 5% based on Friday’s closing prices. The Hess Group’s chief executive is expected to join the board of directors of the new entity upon completion.
Chevron therefore concluded a definitive agreement with Hess to acquire all of Hess’ outstanding shares in an all-stock transaction valued at $53 billion, or $171 per share based on October 20 closing prices. Under the terms of the agreement, Hess shareholders will receive 1.0250 Chevron shares for each Hess stock. The total enterprise value, including debt, of the transaction is $60 billion. The acquisition of Hess enhances and diversifies Chevron’s already privileged portfolio. “The Stabroek block in Guyana is an extraordinary asset with industry-leading cash margins and low carbon intensity that is expected to enable production growth over the next decade. Hess’ Bakken assets add another position of leader in U.S. shale to Chevron’s operations in the Denver-Julesburg Basin and the Permian Basin and further strengthen national energy security. The combined company is expected to grow its production and free cash flow more quickly and for a longer period of time. longer than Chevron’s current five-year forecast,” Chevron explains.
The acquisition price is structured with 100% shares using Chevron’s equity. In total, upon closing of the transaction, Chevron will issue approximately 317 million shares of common stock. The company’s total value of $60 billion includes net debt and the book value of non-controlling interests. The transaction was unanimously approved by the boards of directors of both companies and is expected to be completed in the first half of 2024. The acquisition is subject to approval by Hess shareholders. It is also subject to regulatory approvals and other customary closing conditions.
rocka Swiss pharmaceutical giant, has agreed to the acquisition of Telavant near Roivant Sciences and of Pfizer (+0.6%) as part of a $7.25 billion deal. Roche will thus obtain the rights to develop, manufacture and market RVT-3101 in the United States and Japan for the treatment of inflammatory bowel diseases and potentially many other diseases. RVT-3101 is a Phase 3-ready antibody with best-in-class, best-in-disease potential, a novel mode of action and strong Phase 2b data in ulcerative colitis. Roche will also gain an option to enter into a global collaboration with Pfizer on a next-generation p40/TL1A-directed bispecific antibody, currently in phase 1. Under the terms of the agreement, Roche will pay an initial purchase price of 7.1 billion of US dollars and a near-term milestone payment of US$150 million. Telavant is owned by Roivant and Pfizer. The completion of the transaction is expected in the fourth quarter of 2023 or the first quarter of 2024.
You’re here (stable) said its capital expenditures for the year would exceed the indicative range of $7 billion to $9 billion announced earlier this year. The Texan car manufacturer is in fact increasing production at its factories and facing the rise of new models – the new Model 3 and Cybertruck. According to regulatory documents, Tesla intends to return to this investment range of $7 billion to $9 billion in the next two years. Furthermore, the American Department of Justice has requested documents relating to the autonomy of the group’s electric vehicles. The DoJ is also studying Tesla’s self-driving feature, as well as its personal benefits and personnel decisions, reports Reuters.