Shares are set to move upwards on Merger Monday, as a record number of big merger news is absorbed by the market, as well as a slew of economic data due for release today.
The 10-year US Treasury yields will also be something to watch.
On Friday, the US indices ended the week on a mixed note, with the Nasdaq closing the day flat.
The Nasdaq ended the week down 0.02% or 1.12 up at 7,119.80.
The Dow Jones Industrial Average closed down 0.05%, down 11.15 at 24,311.19 while the S&P 500 closed up 0.11% at 2.97 at 2,669.91.
The Dow futures is pointing to a positive open, adding 100 points at 24,393.00 while the S&P futures is also looking north, up 7.85 at 2,680.50 while the Nasdaq looks set to a positive start as well, up 30.50 points at 6,703.25.
The West Texas Intermediate crude was dropped 61 US cents to US$67.50, continuing with its losing streak on Friday when it posted a 9 US cents loss.
The market is monitoring the US-Iran situation. President Donald Trump has until May 12 to decide on whether to proceed with sanctions as Iran President Rouhani continues to deflect moves to change the earlier deal brokered under the Obama administration.
At home, the US treasury yield, which breached the 3% psychological mark but fell back again, will be tracked closely by traders.
On the economic front, March data on personal income, consumer spending and core inflation, as well as Chicago’s April numbers on business conditions, and pending home sales numbers for March are all due out today.
The Federal Reserve’s two-day policy meeting will kick off on Tuesday but the market is expecting the central bank to keep rates unchanged and stick to earlier statement on two more rate hikes in 2018.
According to Ari Wald from Oppenheimer & Co: “Investors should prepare for a barrage of “sell in May, and go away” financial news articles this week, and we admit it’s been sound advice if an investor followed it without question for the last 68 years.
“Since 1950, the S&P 500 has averaged a mere 1.4% gain between the months of May and October vs. a 7.2% gain between November and April,” he said in a technical note.
Merger news and more merger news ....
Stocks that will be in focus on Monday include Sprint Corp (NYSE:S), which has plummeted 12.92% in pre-market trading while T-Mobile US Inc (NASDAQ:TMUS) also lost ground, down 2.36%.
In a statement issued on Sunday, the two largest wireless companies, announced a merger which will see the combined entity, holding third spot, behind Verizon and AT&T.
The companies said the new entity – which will have the ability to create a large scale 5G network and thousands of US jobs – will hold on to T-Mobile’s name with T-Mobile’s CEO John Legere leading the team.
In a statement, Legere said: “This combination will create a fierce competitor with the network scale to deliver more for consumers and business in the form of lower prices, more innovation, and a second-ton-one network experience – and do it all so much faster than either company could do on its own.”
And in other merger news that spans across the Atlantic, Walmart Inc (NYSE:WMT) shares will be in focus after its UK arm, Asda Group Ltd agreed to a merger with another big name in the supermarket industry, J Sainsbury plc (LON:SBRY), creating a combined entity with annual revenue of about US$69bn.
Walmart shares were up 0.74% in premarket trade.
More merger news ahead as Marathon Petroleum Corp (NYSE:MRO) confirmed its plans to acquire rival refiner Andeavor (NYSE:ANDV) in a US%35.6bn deal.
Both companies saw their shares move higher in pre-market.
And the merger story continues with Marriott Vacations Worldwide Corp (NYSE:VAC) announcing plans to buy up fellow peer ILG Inc (NASDAQ:ILG) in a US$4.7bn deal. The timeshare company’s shares dipped in pre-market trade while ILG’s shares soared 5.7%.
Prologics Inc (NYSE:PLD) announced plans to buy competitor DCT Industrial Trust Inc (NYSE:DCT) for US$8.4bn, boosting the share prices of both companies in pre-market deals.
Companies with results in the horizon today include McDonald’s Corp (NYSE:MCD), Arconic Inc (NYSE:ARNC) and AK Steel Holding Corp (NYSE:AKS).