Stock market index futures jumped on Monday after PepsiCo Inc. kicked off the second-quarter earnings season on an upbeat note and a semiconductor deal brightened investors’ mood, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Strong results from PepsiCo Inc. (Nasdaq: PEP) offered investors some good news as they brace for what could be the sharpest drop in quarterly earnings for S&P 500 firms since the financial crisis.
Pepsi rose 2.2% in premarket trading as it benefited from an increase in the consumption of some of its snacks during the coronavirus lockdown.
Quarterly results from big banks will be the focus this week as those results will reveal the extent of the damage caused on corporate profits by lockdowns. Analysts project a return to S&P 500 earnings growth in 2021.
Recent economic data has pointed to an uptick in business activity, helping the Nasdaq clinch its sixth record close in seven weeks on Friday. The S&P 500 is only around 6% below its record high hit in February.
As of 9:15 a.m. EDT, Dow Jones futures were up 0.77%. S&P 500 futures moved 0.7% higher and Nasdaq futures jumped 0.96%.
Stocks to Watch Today
Churchill Capital III Corp. (NYSE: CCXX) — The public investment company has agreed to a merger with MultiPlan Inc., valuing the company at $11 billion. The new company will operate as MultiPlan and trade on the NYSE. Shares of Churchill Capital III were up 23.7%.
BioNTech SE (Nasdaq: BNTX) — Shares of the German biotech company shot up 10.4% after its collaboration COVID-19 vaccine with Pfizer Inc. (NYSE: PFE) earned “fast track” status by the federal government. Pfizer shares were up 3.1%.
Tesla Inc. (Nasdaq: TSLA) — The electric auto manufacturer is inching closer to being included in the S&P 500 index, pushing shares 5.8% higher. The company could be eligible when its second quarter earnings are released on July 22.
Main Street Lending Program Slowed by Disagreements
Leaders at the Federal Reserve and the Department of the Treasury disagreed over starting the flagship lending program for small and midsize businesses, causing a delay in the program’s release.
The Main Street Lending Program is a $600 billion initiative to help support businesses during the early stages of the coronavirus pandemic.
Fed officials favored easier terms that would increase the risk of the government losing money, while Treasury officials wanted a more conservative approach, according to The Wall Street Journal.
Google to Invest $10 Billion in India
Over the next few years, Alphabet Inc.’s (Nasdaq: GOOG) Google will invest $10 billion in India as part of plans to make the internet “affordable and useful” for nearly a billion people.
The Google for India Digitization Fund will spend money in the country’s tech sector over the next five to seven years with investment, partnerships and infrastructure, according to CNN Business.
Plans focus on providing affordable access and information to every Indian in their own language, along with building new products and helping businesses with digital transformation.
Analog Devices to Buy Rival Maxim for $21 Billion
Massachusetts-based semiconductor giant Analog Devices Inc. (Nasdaq: ADI) has agreed to buy rival Maxim Integrated Products Inc. (Nasdaq: MXIM) for $21 billion in stock.
According to Bloomberg, Analog will pay $0.63 per share for each Maxim share — a 22% premium to Maxim’s closing price on Friday.
Analog Devices shareholders will own 69% of the combined company, which will be valued at around $68 billion including debt.
Shares of Maxim were up 17% in premarket trading while Analog Devices was up 2%.
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Earnings Report
Here are the companies releasing earnings reports today:
PepsiCo Inc. (Nasdaq: PEP)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.