A whirlwind weekend for deals has seen investors indulge in some Monday M&A-nia, allowing the markets to rise at the start of the week.
On a macro-level, the most important headline was that TikTok-owner ByteDance has rejected Microsoft’s advances, instead opting for Oracle (NYSE:ORCL) as their US-suitor. A Reuters report suggests that rather than a sale, this partnership would act as a ‘restructuring’, placing ByteDance’s US user data in the hands of the American firm.
That it is Oracle (NYSE:ORCL) over Microsoft (NASDAQ:MSFT) shouldn’t post a problem for Trump – the former’s founder Larry Ellison held a fundraiser for the President back in February, while Trump himself publicly backed Oracle to pair with TikTok when this saga first began. However, the President might be unhappy with the specifics of the deal, namely that it is unclear if anything will actually be owned, rather than just managed, by Oracle.
From a geopolitical perspective, it will be interesting to see whether this causes a flare up, or a cooling down, of relations between the US and China. It could be seen as a compromise. Then again, Trump isn’t a fan of compromises...
Next up on the morning’s M&A-genda was the latest relocation for ARM Holdings (LON:ARM). Bought by Softbank in 2016, the Japanese company is now off-loading the Cambridge-based semiconductor firm to Nvidia for $40 billion. It’s a move that has gone down poorly with ARM’s founders, due to a potential loss of jobs in the UK.
Finally, Gilead (NASDAQ:GILD) is buying drugmaker Immunomedics for $21 billion, in maybe the least controversial decision of the day.
Initially strong, the European markets did wane slightly as the din of the opening bell receded. The CAC maintained a solid 0.6% increase, with the DAX up 0.4%.
However, with cable climbing 0.4%, and the pound rising 0.1% against the euro, the FTSE’s gains were reduced to 0.2%, nevertheless pushing the UK index back above 6050.
As for the Dow Jones, that is currently set for a more robust start, with the futures pointing to a 270-point, 27900-crossing surge this afternoon.
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