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Fly Intel - End of Day Brief - Friday May 24, 2019

Stocks end in positive territory ahead of long weekend

U.S. stocks, which had a volatile week due to mounting concerns about the impact of the U.S. trade dispute with China, closed out with an up session before the long holiday weekend. The S&P 500 saw a broad-based, though muted, advance despite disappointing factory data.

ECONOMIC EVENTS: In the U.S., durable goods orders fell 2.1% in April, slightly worse than the estimated 2% decline. Excluding transportation, orders were unchanged last month. Nondefense capital goods orders excluding aircraft, sometimes pointed to as a proxy for broader business investment, were down 0.9%. In energy news, Baker Hughes reported that the U.S. rig count is down 4 rigs from last week to 983.

In Europe, Theresa May announced she will quit as Britain's prime minister and will stand down as Conservative Party leader on June 7.

TOP NEWS: Shares of Boeing (BA) rose 1% after Daniel Elwell, acting head of the Federal Aviation Administration, said an eight-hour meeting with global air regulators to talk about the grounded Boeing 737 MAX was "exceedingly positive" and "constructive", according to Reuters. FAA representatives informed members of the United Nation's aviation agency that they anticipate approval of Boeing's 737 MAX aircraft to fly in the U.S. as soon as late June, reports added. Bloomberg later reported, however, that the SEC Is investigating whether the planemaker properly disclosed issues tied to the grounded jetliner, and CNBC reported that United Airlines (UAL) plans to extend 737 MAX flight cancellations through August 3.

China's Semiconductor Manufacturing International Corporation (SMI) announced earlier that the company has notified the New York Stock Exchange that it will apply for the voluntary delisting of its American depositary shares, or "ADSs," from the NYSE. However, CNBC's Yun Li said the company told her the decision was due to low trading volume and high costs and "has nothing to do with the trade war and Huawei incident."

In earnings news, HP Inc. (HPQ) shares rose 4% after the printer and PC maker reported better than expected sales and earnings for its recently completed quarter. HP Enterprise (HPE) was also higher following last night's fiscal Q2 results as its earnings were better than expected but its sales fell short of the consensus forecast.

Meanwhile, Novartis (NVS) shares closed about 4% higher in New York after the FDA approved the company's Zolgensma for the treatment of Spinal Muscular Atrophy, or SMA. The wholesale acquisition cost of Zolgensma, a one-time gene therapy, is $2.125M, which the company said is 50% of the 10-year cost of current chronic SMA treatment.

Shares of Centene (CNC) gained 3% after the Wall Street Journal reported that Daniel Loeb's Third Point has acquired a stake in the company and wants it to consider selling itself before spending $15.3B to acquire WellCare (WCG). Third Point later confirmed to CNBC that it owns a stake in Centene, adding that it believes the WellCare deal is "in the best interest of shareholders."

In addition, the Wall Street Journal reported that a multibillion-dollar settlement between Facebook (FB) and federal regulators over privacy errors has been delayed by a divide between Republicans and Democrats on the Federal Trade Commission.

MAJOR MOVERS: Among the noteworthy gainers was TSYS (TSS), which rose 14% after Bloomberg reported that Global Payments (GPN) has held deal talks about a potential merger or other types of partnership. CNBC subsequently said that Global Payments is nearing a deal to buy TSYS for about $20B in an all-stock deal expected to be announced Tuesday. Global Payments shares were up 4% after the news.

Also higher was Hibbett Sports (HIBB), which gained 21% after reporting quarterly results.

Among the notable losers was Dynavax (DVAX), which slid 9% after announcing a strategic restructuring to focus on its vaccine business. Also lower were Foot Locker (FL) and Splunk (SPLK), which fell a respective 16% and 7% after reporting quarterly results.

INDEXES: The Dow rose 95.22, or 0.37%, to 25,585.69 , the Nasdaq gained 8.73, or 0.11%, to 7,637.01 , and the S&P 500 advanced 3.82, or 0.14%, to 2,826.06 .


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