US OPEN: Sprint and T-Mobile set to surge on merger approval

• US futures point to Wall Street indices opening at record highs

• T-Mobile and Sprint receive green light to merge

• Slack Technologies plunges after pouring cold water on reports of IBM actions

US stock markets are set to open higher on Tuesday and benefit from upbeat moods seen in Europe and Asia. No US data is scheduled for release today but markets may become more volatile at 3:00 pm GMT as Jerome Powell will testify before the House panel. The text of the testimony has been already released and it says that the policy rate stance is appropriate. However, Fed is closely monitoring coronavirus outbreak as disruptions in China could spill over to the global economy.

Russell 2000 (US2000) found support at the early-January swing level of 1655 pts. The index is moving higher today along with other Wall Street indices. While other US indices keep reaching new all-time highs, US2000 is still trading below its ATH reached in August 2018! Resistance zone at 1700 pts continues to be a major hurdle and the index looks like its gearing for another test. Aforementioned swing level (1655 pts) could get in play in case bulls once again fail to break above. Source: xStation5

Under Armour (UA.US) is taking a major dive in today’s pre-market trading. The US apparel company reported earnings for Q4 2019. Adjusted EPS of $0.1 matched market estimates and was 11.1% YoY higher. Quarterly revenue of $1.44 billion was slightly weaker than expected but 3.7% YoY higher. Revenue increased in all regions the company is present in but in most cases sales growth was weaker than expected. While Q4 2019 earnings were not that bad, it is the 2020 forecast that is responsible for pre-market plunge. The company said that it expects full-2020 revenue to decline by a low single-digit. Under Armour said that the drop takes into account the negative impact from China's coronavirus outbreak.

Under Armour (UA.US) has been trading in an descending triangle pattern as of late. The lower limit of the pattern is marked by support zone ranging above $17.60 handle. However, the stock is seen taking an over 10% dive at the opening of today’s session and is likely to trade below the aforementioned support zone. In such a scenario, this zone will serve as the nearest resistance to watch. The final support can be found at 2019 low of $15.05. Source: xStation5

US District Court Judge in Manhattan announced a decision on the proposed takeover of Sprint (S.US) by T-Mobile US (TMUS.US). According to reports, the judge gave companies a green light to merge. This puts an almost 3-year antitrust battle to an end. Markets seem to be buying this news as pre-session trades point to an over 60% bullish price gap for Sprint at the open. T-Mobile is expected to open 7% higher. Dish Network (DISH.US) is also set to open higher as US television provider is expected to buy assets from T-Mobile and Sprint in case the merger gets regulatory approval.

Slack Technologies (WORK.US) is trading lower in pre-market. The US software company enjoyed solid gains yesterday after a report surfaced saying that IBM (IBM.US) will move all of its employees to Slack platform. Slack issued a statement after markets closed in which it neither confirmed, nor denied the news.

Slack Technologies (WORK.US) rallied yesterday on report that IBM is about to expand its partnership with the company. However, a statement from the company after market close poured some cold water on investors’ heads and caused a pullback in today’s pre-session trading. The stock is expected to launch today’s trading within its previous consolidation range of $20-26.50. Source: xStation5