US OPEN: Wall Street opens lower as ADP report disappoints

 

US indices launched today's session slightly lower, pausing for breath after recent strong rally driven by progress in deploying vaccines to treat the coronavirus. Senate Majority Leader Mitch McConnell rejected a bipartisan proposal for a $908 billion stimulus package aimed at breaking the stalemate over new stimulus in Congress. Meanwhile private businesses in the US hired 307K workers in November, which is the lowest reading in four months and might be a sign that soaring new infections and business restrictions are hampering the labor market's recovery. On the coronavirus front  US reported nearly 180K new infections on Tuesday, the highest infection rate in 4 days while UK authorities approved the Pfizer-BioNTech Covid-19 vaccine for emergency use. Vaccine will be available from next week and it is expected that European and US regulators will approve it fairly shortly.

Salesforce (CRM.US) stock dipped nearly 6% in premarket after company confirmed previous reports that it was buying messaging and workflow platform Slack Technologies (WORK.US) for over $27 billion in cash and stock which equals to about $45.86 per share. Slack shares fell more than 1% in premarket.

 

US drugmaker Merck & Co (MRK.US) had sold its equity investment in vaccine developer Moderna (MRNA.US) today. Merck said it had achieved a substantial gain on its direct holding in Moderna, particularly this year, as the company moved closer to developing a coronavirus vaccine.

Tesla (TSLA.US) shares dropped 2.7% in pre-market after CNBC reported that CEO Elon Musk sent an email to employees Tuesday warning they will have to control costs or the stock “will immediately get crushed like a souffle under a sledgehammer!”

Thermo Fisher (TMO.US) was initiated by Goldman Sachs with a “buy” rating, with the bank calling the company “a core, long term holding due to a durable growth algorithm driven by sector leading exposure to the fast-growing BioPharma and Clinical/Diagnostics end markets and a revenue mix that is over 75% recurring.”

 

Disney (DIS.US) — Citi hiked his 12-month price target on the entertainment giant to a Street high of $175 per share, implying a 17% upside from Tuesday’s close of 149.44 per share. “We continue to expect a measured recovery within Disney’s core businesses … At the same time, given the continued momentum of Disney’s streaming apps, we are raising our outlook for the firm’s DTC segment,” the analyst said.