The major averages have been supported this morning by news President Trump is "seriously considering" a capital gains tax cut and indications that stimulus talks in Congress will resume. As for virus developments, Russia registered the first "approved" vaccine for COVID-19, although a number of experts have questioned the validity of what appears to be a very early approval.
ECONOMIC EVENTS: In the U.S., the Producer Prices Index bounced 0.6% in July, with the core rate jumping 0.5%, which both point to hotter than projected inflation.
TOP NEWS: As the TikTok deal saga continues, Charles Gasparino of Fox Business reported that, despite reports of "preliminary" talks inolving Twitter (TWTR) for TikTok's U.S. operations, Microsoft (MSFT) is at least for now the only possible deal being "actively pursued." The news comes a day after the South China Morning Post claimed that TikTok owner ByteDance is unlikely to sell the business to Twitter or Microsoft.
On the earnings front, Tilray (TLRY) shares fell 12% after the company reported lower than expected second quarter results, driven by a 15.8% year-over-year decrease in Adult Use sales, a 5.3% decrease in Canada Medical sales, and a 5.1% decrease in Hemp sales. Tilray said that sequential sales declines in Adult Use and Canada Medical were "largely attributable" to the impact of COVID-19.
In M&A news, Ligand Pharmaceuticals (LGND) has agreed to acquire all outstanding shares of Pfenex (PFNX) for $12 per share in cash, or $438M in equity value on a fully diluted basis. In addition, Ligand will pay $2 per share or $78M as a Contingent Value Right in the event a predefined regulatory milestone is achieved by December 31, 2021, for a total transaction value of up to $516M. The deal is expected to close in the fourth quarter. Ligand shares were 3% lower after the news, while Pfenex shares surged 66% higher.
Additionally, Boeing (BA) shares rose 3.5% after the company reported that it delivered four jetliners in July and said customers cancelled 43 more of its still-grounded 737 MAX aircraft. Boeing reports no new orders last month. Boeing also removed orders for nine more MAX jets from the backlog from customers facing financial and contract challenges, taking its net backlog down to 4,496 total jets.
MAJOR MOVERS: Among the noteworthy gainers was HD Supply (HDS), which rose 8% after Clayton, Dubilier & Rice agreed to acquire HD Supply's White Cap business in a $4B deal. Also higher were j2 Global (JCOM) and Nautilus (NLS), which gained a respective 17% and 15% after reporting quarterly results.
Among the notable losers was ZoomInfo (ZI), which slid 10% after it reported quarterly results and provided guidance for the third quarter and fiscal 2020. Also lower after reporting quarterly results were Fulcrum Therapeutics (FULC) and GreenSky (GSKY), which fell 45% and 21%, respectively.
INDEXES: Near midday, the Dow was up 276.35, or 0.99%, to 28,067.79, the Nasdaq was up 10.07, or 0.09%, to 10,978.43, and the S&P 500 was up 16.32, or 0.49%, to 3,376.79.
