S&P 500 Enters Correction Territory, Major Mergers Shake Markets - PandaForecast.com
Maximizing Profits: When is the Right Time to Sell Your Business?

April 23, 2024 Maximizing Profits: When is the Right Time to Sell Your Business?

Selling a business can be a momentous decision filled with many considerations and uncertainties. As an entrepreneur, this also symbolizes your years of…
Improve Your Financial Status: A How-To Guide

April 12, 2024 Improve Your Financial Status: A How-To Guide

Navigating through the complexities of personal finance can often feel like walking through a maze blindfolded. This guide is crafted especially for you,…
How ZIM Integrated Container Tracking is Revolutionizing Global Trade

April 12, 2024 How ZIM Integrated Container Tracking is Revolutionizing Global Trade

Have you ever wondered how your online shopping packages get to you? A big part of the answer is ZIM Integrated Container Tracking.…
6 Best Growth Stocks To Buy Now According to Metatrader 5

March 15, 2024 6 Best Growth Stocks To Buy Now According to Metatrader 5

One of the reasons investors prefer growth stocks is that they are expected to perform better than other companies in terms of sales…

S&P 500 Enters Correction Territory, Major Mergers Shake Markets

October 28, 2023

S&P 500 Enters Correction Land

The S&P 500 (SP500) encountered a drawback, dropping by 2.53% within the week to finish at 4,117.37 points. Four out of five sessions ended in losses last week. This downturn drove the benchmark index into a correction phase – its closing price on Friday showed more than a 10% decrease from its highest point this year which it hit on July 31st. This comes shortly after the Nasdaq Composite (COMP.IND) who also entered correction territory just two days earlier.

The weekly pullback can mainly be pinned on a slump in mega-technology stocks. Of the S&P’s 11 sectors, ten were down – Utilities (XLU) being the only sector to record any gains. Energy (XLE) and Communication Services (XLC) had lost over 6% and 5%, respectively while Technology (XLK) saw almost a 2% dip.

Multibillion-Dollar Deals Kick Off Merger Monday

Merger Monday signaled two major multibillion-dollar mergers & acquisitions deals this week . Chevron (CVX) plans to procure Hess Corp. (HES) in a $53B all-stock deal meant to expand its operations into the DJ and Permian Basin regions, announced less than two weeks after Exxon Mobil’s $60B acquisition of Pioneer Natural Resources (PXD). Following this news, Chevron shares dipped by around three percent, while Hess’ share price climbed slightly more than two percent upon announcement of the deal.

With another substantial purchase announcement, Swiss based pharmaceutical company Roche (OTCQX:RHHBY), is set to acquire Telavant Holdingsfrom Roivant Sciences (ROIV) and Pfizer (PFE) expects to pay $7.1B upfront. This transaction will include rights to commercialise a potential new treatment for inflammatory bowel disease in the U.S. and Japan. News of the impending deal initiated an upward surge of approximately 15% in Roivant’s share value.

Bonds and Bitcoin See Major Movements

At present, the bond market is rather volatile as big names like Bill Ackman and Bill Gross predict its future moves almost simultaneously. The 10-year Treasury (US10Y) yield shot up to 5% on Monday and within two months, the 30-year Treasury (US30Y), found itself at an elevated 5.15%. According to SA analyst Adam Vincze, “The Treasury yield curve has remained inverted since last year, pointing towards a probable downturn in the economy – a phenomenon which many infer is cleverly hidden by current swelling budget deficits.” Meanwhile, Bitcoin (BTC-USD) enthusiasts celebrate this week as cryptocurrency briefly touched $35K on Tuesday, boosted by anticipation surrounding possible approval of United States’ first Direct-Investment ETF for bitcoin.

Tech Earnings Report Show Diverse Outcomes

Tech sector earnings season disclosed mixed results, which caused respective company share prices to sway in different directions. Meta Platforms (META) initially saw a rise of nearly 4% during after-market trading on Wednesday when it reported revenues, profits, and user growth exceeded forecasts. However, these gains were short-lived; dwindling nearly 4% by the end of Meta’s earnings call due to warnings about “increased uncertainty” and “turbulence ahead“.

It’s worth noting that Nasdaq Composite Index (COMP.IND), heavily influenced by technology stocks, also found itself in correction territory on Thursday. Meta has been hit by a wave of lawsuits filed by California and numerous other U.S. states, accusing Instagram and Facebook of exploiting youngsters for profit. Similar claims have been made against Snap (SNAP), TikTok, and Google (GOOG, GOOGL) with hundreds of lawsuits filed.

Issues Arise for General Motors’ Cruise

Dire straits surround General Motors(GM) Cruise, its autonomous vehicle branch, after it halted operations citywide in San Francisco. The situation worsened when the company’s permits were revoked by the California DMV following a hit-and-run incident involving one of its self-driving cars on Oct. 2nd.

Management at Cruise admitted that “rebuilding public trust is our biggest focus right now” and announced plans to “proactively pause driverless operations while we review our processes, systems, and tools.” Their operations include but are not limited to cities like Austin, Dallas, Houston, Phoenix, and Miami.

2 thoughts on “S&P 500 Enters Correction Territory, Major Mergers Shake Markets”

  1. This week’s market corrections hit hard. It’s gut-wrenching to see four out of five trading days ending in losses and the overall index falling over 10% from its peak. However, Chevron’s planned acquisition of Hess Corp may offer some respite as this deal means potential growth.

    On the other hand, my interest in cryptocurrencies is piqued by Bitcoin’s value surging to $35K due to potential approval of a Direct-Investment ETF in the U.S. )) This highlights the importance of having a diversified investment portfolio, providing protection from sector-specific downturns whilst capturing growth elsewhere.
    And, yes, the Cruise news is nerve-wracking considering significant investments have been made towards autonomous vehicles. Appalled yet hopeful – just another mixed bag week being an investor!


Leave a Comment