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Wall Street opens lower after a long weekend
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Small-cap Russell 2000 is a top laggard among US indices
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PayPal gains after KKR & Co agreed to buy receivables from the company
US traders returned to the markets after a long weekend in slightly downbeat moods with major Wall Street indices trading lower at the beginning of today's cash trading session. Small-cap Russell 2000 is a top laggard while tech-heavy Nasdaq managed to erase earlier declines and now trades little changed compared to Friday's cash closing prices.
Source: xStation5
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Open account Try demo Download mobile app Download mobile appRussell 2000 is a top laggard among Wall Street indices at the beginning of the first cash session following a long weekend. Taking a look at Russell 2000 futures (US2000), we can see that the index has recently failed to break above the 1,900 pts resistance zone and is now pulling back. A point to note is that the index has realized the range of the upside breakout from a recent short-term trading range (yellow rectangles) and started to drop later on. Should the pullback continue to gain traction, the 1,820 pts swing zone could be the first target for sellers. The area is marked with previous price reactions as well as the 200-session moving average (purple line).
Company News
US-listed Chinese stocks are pulling back at the beginning of the Wall Street session following a downbeat trading during the Asia-Pacific session. The move is driven by a smaller than expected rate cut delivered by People's Bank of China to 5-year loan prime rate as well as failure of Chinese authorities to issue specific economic support measures. Among US-listed Chinese stocks one can find Alibaba (BABA.US), JD.com (JD.US) or Nio (NIO.US).
PayPal Holdings (PYPL.US) gains slightly at the beginning of today's Wall Street session. Investment company KKR & Co agreed to purchase buy-now-pay-later receivables from PayPal worth as much as €40 billion. PayPal said that the transaction will generate $1.8 billion in proceeds and will allow the company to repurchase additional $1 billion worth of its own shares this year.
Shares of PayPal (PYPL.US) are trading higher following news of KKR & Co purchasing receivables from the company. Stock is attempting to make a break above the $67 resistance zone, marked with previous price reactions and the 50-session moving average (green line). Source: xStation5
Eli Lilly (LLY.US) announced that it has entered into a definitive agreement to purchase Dice Therapeutics, an immune drug developer, for $48 per share in cash. Eli Lilly will launch a tender offer for all outstanding shares of Dice, bringing the total value of a deal to $2.4 billion. Deal is expected to close in Q3 2023. Nasdaq-listed shares of Dice finished yesterday's trading at $33.85 so Eli Lilly's offer represents an over-40% premium. Eli Lilly
Grab Holdings (GRAB.US) traded higher at the beginning of today's Wall Street session. Bloomberg news reported that the company is planning to engage in a round of massive layoffs as investors pressure the company to slash costs. Bloomberg reports that layoffs are likely to be announced as soon as this week and may be bigger than the 5% cut to workforce the company delivered back in 2020.
Grab Holdings (GRAB.US) launched today's session higher on news of planned layoffs. However, those gains have been completely erased already. Stock has recently broken above the $3.40 price zone and unless we see a pullback below this hurdle, a test of the upper limit of the ongoing trading range at $4.00 remains an option. Source: xStation5
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