Recession is gripping some of the world’s largest economies, plus stocks to watch today in the Money and Markets Wall Street Wake-Up.
The Top Story
Some of the biggest global economies are nearing recession and the coronavirus could tip them over the edge.
Japan, the third-largest economy, saw a 1.6% drop in economic growth in the fourth quarter of 2019. Germany, the largest economy in Europe, reported its growth as flat in the same period.
What it means: The impact of a recession is spreading. Other economies are in peril as well. Hong Kong is in recession while Singapore is close. Other Asian nations like Indonesia and Malaysia have also reported weak or no economic growth.
What about the U.S.? For the first time in four years, the American services sector suffered a contraction in February. That could indicate that the U.S. economy is not as strong as people think.
Other market news: The advanced spread of the coronavirus has hammered U.S. equities in premarket trading.
As of 8 a.m. Eastern time, Dow Jones Industrial Average futures dropped 2.6%. Nasdaq Composite futures were down 2.8%, and S&P 500 futures were off 2.5%.
Stocks to Watch Today
Intuit Inc. (Nasdaq: INTU) — The financial software company is bidding to buy personal finance company Credit Karma Inc. (see below) for $7 billion. Shares of Intuit were down 2.3% Monday morning.
Berkshire Hathaway Inc. (NYSE: BRK.B) — Shares of the multinational holding company plummeted 3.5% after it reported a 23% drop in its operating profit. Jumps in holdings like Apple Inc. (Nasdaq: AAPL) did help push Berkshire to record full-year earnings.
Xperi Corp. (Nasdaq: XPER) — The California-based technology firm received an unsolicited bid for $1.16 billion, or $23.30 per share, from private equity firm Metis Ventures. Shares of Xperi were up 3% early Monday morning.
In the News
Personal finance company Credit Karma Inc. is getting a buyer.
According to The Wall Street Journal, TurboTax parent, Intuit Inc. (Nasdaq: INTU) is buying the company for $7 billion in cash and stock.
The deal could be announced today.
Credit Karma was valued at around $4 billion during its last private shares sale two years ago. The acquisition is the largest in Intuit’s 37-year history.
U.S.-India to sign $3 Billion in Defense Deals
During a two-day state visit to India, President Donald Trump said the U.S. will sign military deals worth more than $3 billion.
The Defense Department has already approved the sale of nearly $1.8 billion in arms to India while the Indian Parliament gave the green light to a $2.6 billion purchase from Lockheed Martin Corp. (NYSE: LMT) for its MH-60R Seahawk helicopter.
The deals are part of negotiations for a new trade deal with India, Trump said. However, no timeline has been established for a deal.
Pepsi Is Buying A Major Chinese Snack Retailer for $705 Million
American food, snack and beverage giant PepsiCo Inc. (Nasdaq: PEP) is buying Be & Cheery — a Chinese company that sells snacks online.
The deal, announced Sunday, values Be & Cheery at $705 million and puts Pepsi in a snack market that has risen more than 400% between 2006 and 2016.
Other Morning Reads
About to Retire? These States Have the Best (and Worst) Quality of Life (Money and Markets)
With Migrant Workers in Limbo, Part of China’s Economy Is Stalled (The Wall Street Journal)
Brodrick: 3 Lessons from Wuhan to Help Put Gold on the Menu (Money and Markets)
Earnings Report
Here are the companies releasing earnings reports today:
Cooper Tire & Rubber Co. (NYSE: CTB)
Cornerstone OnDemand Inc. (Nasdaq: CSOD)
Guardant Health Inc. (Nasdaq: GH)
HP Inc. (NYSE: HPQ)
Palo Alto Networks Inc. (NYSE: PANW)
Check back each morning before the opening bell for stocks to watch today with the Wall Street Wake-Up, here on Money and Markets.