US OPEN: Bearish opening of Monday's session on Wall Street, Arcadium Lithium shares soar

• Wall Street opens lower on Monday
• Arcadium Lithium plc shares soared 40% following confirmation that Rio Tinto Group has approached the company regarding a potential acquisition.
• Casino stocks in green after Wynn Resorts announced it had been awarded the first commercial gaming operator's license in the United Arab Emirates.

US equities are set for a lower open, with the Russell 2000 leading losses, down 0.7%. The S&P 500 is down by 0.28% with Nasdaq 100 0.34% lower. 

In Europe, most indexes are in the green. German DE40 is currently the worst performing and is 0.51% down, followed by NED25 and SUI20. French CAC40 and  Polish W20 are flat. Spanish SPA35 is best performing index with a rise of 0.55%

Pfizer Inc. shares rose as much as 2.7% on Monday following reports that activist investor Starboard Value has taken a stake of about $1 billion in the company. Air Products and Chemicals Inc. stock climbed 6% after the Wall Street Journal reported that activist investor Mantle Ridge has acquired a stake of over $1 billion in the industrial gas company.

Current volatility observed on Wall Street. Source: xStation 

Breakdown of the S&P 500 index by sectors. Source: Bloomberg Finance L.P

The Nasdaq-100 index, represented by the US100 contract, is trading above the mid-August highs at 19,917.81, a key level for both bulls and bears. Bulls have protected this level for 12 trading days, indicating strong demand. For continued upward momentum, resistance at the 78.6% Fibonacci retracement level must be broken. The index has been in an uptrend since late July, forming higher highs and higher lows, but is now facing resistance near this Fibonacci level.

However, the uptrend appears to be forming a bearish wedge, with the 50% Fibonacci retracement level potentially confirming a trend reversal if broken. For bears to regain control, the mid-August highs of 19,917.81 must be breached, which could lead to a test of support at the 61.8% Fibonacci retracement level—previously strong resistance. A break of this support could quickly bring the 100-day and 50-day SMAs into play.

Currently, the RSI is showing bearish divergence, with lower lows and lower highs, but is still consolidating near the upper side of the neutral zone. The MACD has signaled a sell, and its tightness suggests potential for high volatility. Additionally, the 50-day SMA is approaching the 100-day SMA, and a bearish crossover could trigger further downside momentum. Source: xStation 5

News:

• Pfizer Inc. (PFE.US) shares rose as much as 2.7%on Monday following reports that activist investor Starboard Value has taken a stake of about $1 billion in the company. Starboard is seeking changes to turn around Pfizer's performance and has approached former CEO Ian Read and former CFO Frank D'Amelio for potential assistance. The activist investor's involvement comes as Pfizer faces challenges, including declining COVID-19 product sales and recent struggles with new product launches. Analysts caution that there may be no quick fixes to boost shareholder value.
• Air Products and Chemicals Inc. (APD.US) stock climbed 6% after the Wall Street Journal reported that activist investor Mantle Ridge has acquired a stake of over $1 billion in the industrial gas company. Mantle Ridge, led by Paul Hilal, is expected to push for improvements in strategy, capital allocation, and succession planning for CEO Seifi Ghasemi. The activist investor reportedly views Air Products as undervalued compared to its peers. This news follows Air Products' recent senior management realignment announced in July.
• Arcadium Lithium plc (ALTM.US) shares soared 40% following confirmation that Rio Tinto Group has approached the company regarding a potential acquisition. The move comes as major miners seek to increase their exposure to energy-transition metals. Some Arcadium investors have expressed concern over the timing of Rio's approach, given that Arcadium's current market value of $3.3 billion is about half of what it was at the start of the year. Analysts suggest that Rio Tinto may need to offer a significant premium, with some investors arguing for a valuation closer to $8 billion.
• Wynn Resorts (WYNN.US) and Las Vegas Sands (LVS.US) shares rose 2% and 3% respectively after Wynn Resorts announced it had been awarded the first commercial gaming operator's license in the United Arab Emirates. However they have retraced most of the gains already. The license was granted by the country's General Commercial Gaming Regulatory Authority. Wynn is developing a luxury resort at Al Marjan Island in Ras Al Khaimah as part of a joint venture. This development comes as the UAE sets up federal entities to regulate responsible gaming and introduces liberal legal reforms to maintain its competitive edge in the region.

Other news coming from individual S&P 500 index companies. Source: Bloomberg Financial LP