US markets to open lower as Nasdaq pulls back from 5000. M&A, Netflix and Apple in focus
01:00, 03 mars 2015
· Av CMC Markets
With the Nasdaq Composite having broken 5,000 and the S&P 500 and Dow Jones both having made new record highs on Monday; US markets are expected to pullback on Tuesday’s open. The eventual direction will be subject to a number of prominent retail earnings reports from the likes of AutoZone and Best Buy as well as the Redbook retail sales report for February.
Sentiment was lifted by somewhat of a ‘Merger Monday’ yesterday with two of the more prominent deals coming from HP which will buy Aruba Networks and PayPal which is set to buy Paydiant Inc.
The value of US-targeted M&A was up 13% in February from January but down a whopping 42% year-over-year in what has been a tepid start for deals in 2015 when compared with last year. It has again been the healthcare industry leading the way; the two biggest deals were Pfizer buying Hospira and Valeant buying Salix.
AutoZone, Best Buy and Dick’s Sporting Goods all report earnings followed by the Redbook index of same-store retail sales growth before the open on Tuesday.
Netflix announced it will begin its online TV and movies streaming service in Australia and New Zealand in March it what could be a big future revenue-boost for the company. Shares closed higher on the news and now hover just below all-time highs around $490.
Shares of Apple closed for a second time below $130 yesterday after the release of the latest iteration of the flagship Samsung Smartphone, the iPhone’s biggest competitor. The Galaxy S6 is a deliberate challenger to the iPhone 6 incorporating a more “Premium” feel with the use of metal and glass rather than the plastic used in the S5. Samsung typically lead Apple in technological advances but Apple arguably just do them better once they catch up. In the meantime, there is scope for Samsung to regain some recently lost market share at the expense of Apple.
Futures suggest the:
S&P 500 will open 1 point lower at 2,116 with the
Dow Jones expected to open 46 points lower at 18,251 and the
Nasdaq 100 9 points lower at 4,474.
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