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Stock Market News For Nov 7, 2017

Benchmarks touched new highs on Monday following news of a possible merger between Broadcom and Qualcomm. This is the 26th trading day when all-time high was achieved by all the three key U.S. indexes in 2017, marking the highest number of record highs achieved in a single year. Additionally, optimism over President Trump’s tax cut plans and upbeat third quarter earnings also boosted investor sentiment.

The Dow Jones Industrial Average (DJIA) increased 0.04% or 9.23 points, to close at 23,548.42. The S&P 500 Index (INX) rose 0.1% to close at 2,591.13. The tech-laden Nasdaq Composite Index (IXIC) closed at 6,786.44, gaining 0.3%. A total of 6.6 billion shares were traded on Monday, higher than the last 20-session average of 6.4 billion shares. Advancers outnumbered decliners on the NYSE by a 1.41-to-1 ratio. On Nasdaq, a 1.17-to-1 ratio favored advancing issues. The CBOE VIX increased 2.8% to close at 9.40.

What Drove Markets Northward?

Reportedly, Broadcom Limited AVGO made an offer of around $150 billion, which includes $25 billion of debt to acquire Qualcomm Incorporated QCOM. Broadcom has offered to pay $70 per Qualcomm share, which includes $60 in cash and remaining $10 a share in Broadcom shares, to complete the acquisition. Merger discussions between the two major chipmakers pushed benchmarks upward.

Additionally, Republicans of the House finally unveiled a detailed tax cut policy last week under the Tax Cuts and Jobs Act which seeks to reduce corporate and revoke the taxes paid by large businesses. The tax Bill proposes to reduce the corporate tax rate from existing 35% to 20%, making it the permanent rate. Also, this week the Senate is expected to come up with its own version of the tax cuts Bill. Renewed optimism over the tax Bill boosted sentiment.

On the earnings front, 406 S&P 500 companies, which account for 85.4% of the index’s total market capitalization, reported Q3 earnings as on Nov 3. Total earnings for these companies are up +7.5% from the same period last year on +6.3% higher revenues. (Read More: The Tech Sector's Impressive Earnings Power on Display)

On Monday, shares of Michael Kors Holdings Limited KORS gained 14.7%, emerging as the best performing stock for the S&P 500 after posting bullish fiscal second quarter earnings results. Michael Kors holds a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Further, Saudi Crown Prince Mohammed bin Salman reportedly announced an anti-corruption drive against number of princes, businessmen and ministers of Saudi Arabia. Following this development, oil prices reached their best levels since mid-2015, with Brent crude increasing 3.4% to $64.27 a barrel and WTI crude rising 3% to $57.35 per barrel on Monday. Rally in oil prices led the Energy Select Sector SPDR (XLE) to advance 2.3%, becoming the biggest gainer among key S&P 500 sectors.

Stocks That Made Headlines

AMC Entertainment Q3 Earnings, Revenues Top Estimates

AMC Entertainment Holdings Inc. AMC reported mixed third-quarter 2017 financial results. (Read More)

Will Target's Huge Black Friday Discounts Drive Solid Sales?

Target Corporation TGT unveiled lucrative deals and offers for its customers ahead of Black Friday. (Read More)

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QUALCOMM Incorporated (QCOM): Free Stock Analysis Report
 
Broadcom Limited (AVGO): Free Stock Analysis Report
 
AMC Entertainment Holdings, Inc. (AMC): Free Stock Analysis Report
 
Target Corporation (TGT): Free Stock Analysis Report
 
Michael Kors Holdings Limited (KORS): Free Stock Analysis Report
 
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