U.S. Stocks Set To Open Higher As The Week Starts With Several Big Deals

Vladimir Zernov
Published: Sep 14, 2020, 12:40 GMT+00:00

S&P 500 futures are gaining ground in premarket trading amid optimism about M&A activity.

U.S. Stock Market

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NVIDIA Buys Arm Limited While Gilead Sciences Announces Purchase Of Immunomedics

Gilead Sciences announced its intention to buy Immunomedics for $21 billion in order to boost its position in cancer treatment. Shares of Immunomedics are gaining more than 100% in premarket trading after this announcement.

Meanwhile, NVIDIA announced that it would buy chip designer Arm Limited from Japan’s SoftBank. This deal may have a significant impact on the chip market, and shares of Nvidia are gaining more than 5% ahead of the market open.

Oracle is said to have reached an agreement with ByteDance for a partnership with TikTok. According to reports, Microsoft will not pursure the purchase of TikTok’s U.S. operations due to restrictions imposed by the Chinese government. The structure of Oracle’s deal with TikTok is unclear at this point.

S&P 500 futures are gaining ground in premarket trading as traders cheer the activity on the M&A side.

Israel Decides To Impose A Second Lockdown

Israel will impose a second lockdown starting this Friday to reduce the spread of coronavirus. The lockdown is expected to last three weeks.

Israel’s new lockdown raises fears of similar measures in Europe where some countries are struggling to contain the second wave of the virus.

This development is bearish for oil as lockdowns reduce demand for energy. In addition, fears of another wave of lockdowns may put more pressure on oil and cause a sell-off.

At the same time, this development is bullish for safe haven assets like precious metals. Gold and silver are already set to start the week on a positive note.

Traders Prepare For Fed Interest Rate Decision On September 16

The U.S. Fed is set to announce its Interest Rate Decision on Wednesday. While the Fed is expected to leave the rate unchanged, traders will wait for additional clarifications on Fed’s policy.

Recently, the Fed decided to adopt an average inflation target of 2%. This move will allow the Fed to keep rates low even if inflation starts to increase.

The market will wait for signs that Fed will use additional measures to support the economy. If the Fed’s commentary is dovish enough, the U.S. dollar will find itself under pressure while stocks will get more support.

For a look at all of today’s economic events, check out our economic calendar.

About the Author

Vladimir is an independent trader and analyst with over 10 years of experience in the financial markets. He is a specialist in stocks, futures, Forex, indices, and commodities areas using long-term positional trading and swing trading.

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