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T3's Take 3: Markets Still Mixed, Shire Proposes to Baxalta, Dueling Fortunes in Tech


Today's financial recap and tomorrow's financial outlook.

Today at T3 Live

We've officially booked our first fight... sort of.

You may have heard about the T3 Live Finance Festival, which is being held this November in Miami.

We are proud to announce that John Mauldin, Chairman of Mauldin Economics, just signed on to our program.

Mr. Mauldin has agreed to take part in a good old-fashioned bull-bear debate with Jeff Saut, Chief Investment Officer of Raymond Financial.

We promise you: this will be a showdown for the ages!

Click Here to Read More About the Finance Festival

Mixed Markets

US equities continued to decline today. The S&P 500 closed down 0.2% after a back and forth session. Atlanta Fed President Dennis Lockhart told the Wall Street Journal that current economic data supports a September rate hike, which seemed to trouble traders a bit mid-day.

Across the Atlantic, European stocks were mixed after six solid sessions in a row. Germany's DAX managed to stay in positive territory finishing up 0.1%. European banks took the biggest hit today, with most shedding about 2%.

Greek banks plummeted during their second day of trading since reopening. Piraeus Bank and Alpha Bank each fell about 30%.

Asian markets were a mixed bag. The Japanese Nikkei dipped 0.1%. The Shanghai Composite rallied 3.7% after authorities implemented new rules on short selling which require investors to wait at least one day to cover their positions and pay back loans to buy shares. 

Shire PLC Proposed to Baxalta

Shire PLC (SHPG) confirmed that it made a merger proposal to Baxalta (BXLT) last month. The all-stock offer gave a 36% premium to Baxalta's closing share price on Monday. The merger is expected to generate immediate value by accelerating the growth plans of both companies. The combined company is projected to delivery $20 billion in product sales by 2020.

The all-stock merger would maintain the tax-free nature of Baxalta's spin-off from Baxter last month. Shire stated that it would initiate a share buyback program within two years after the merger.

Shire shares fell 5.4% while Baxalta shares rose 11.9%.

Dual Fortunes in Tech

Netflix (NFLX) set a new all-time high off $122.79, surging after Guggenheim initiated coverage, giving the company a buy rating with a price target of $160. This is the highest target price on Wall Street. The second highest price targets are from FBR Capital Markets, and Goldman Sachs (GS), at $142 and $140, respectively.

Apple (AAPL) shares fell 3.2% today as shares fell further into correction territory following the recent break of its widely-watched 200-day average. The stock has fallen more than 14% since hitting its high of $134.54 in April. Investors are concerned about increasing competition in China, which is viewed as a major growth market for the company.

Wednesday's Financial Outlook

US economic data for tomorrow will include MBA mortgage applications, ADP employment change, trade balance, Markit PMI, ISM non-manufacturing composite, and crude oil inventories.

Overseas economic data will include Swiss CPI, British Markit PMI, Euro-zone retail sales, and Australia's employment report.

Chesapeake Energy (CHK), Dish Network (DISH), Motorola Solutions (MSI), Polo Ralph Lauren (RL), Priceline (PCLN), and Time Warner (TWX) will announce earnings before the open tomorrow.

21st Century Fox (FOXA), CBS (CBS), Energy Transfer (ETP), FitBit (FIT), Marathon Oil (MRO), Sun Life (SLF), and Tesoro (TSO) will announce earnings after the close.
No positions in stocks mentioned.
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