Here are five things you must know for Monday, Oct. 29:
1. -- Stock Futures Turn Higher After Last Week's Selloff
U.S. stock futures were higher on Monday, Oct. 29, as investors juggled a collection of political and economic risks that along with slowing U.S. corporate earnings cloud the near-term outlook for risk markets ahead of next week's midterm elections in the United States.
Wall Street's chief concern has appeared to be the weakening outlook for U.S. corporate profits as the mid-point of the third-quarter earnings season is reached and fewer companies are beating analysts' forecasts, while some of the biggest names across a variety of sectors -- from Caterpillar Inc. (CAT) to Amazon.com Inc. (AMZN) -- have issued cautious forecasts for the months ahead.
Those concerns pushed stocks back into the red for the year after another selloff on Friday, Oct. 26. The S&P 500 has declined for three weeks and was on track for its worst month since February 2009.
On Monday, contracts tied to the Dow Jones Industrial Average rose 119 points, futures for the S&P 500 were up 22.15 points, and Nasdaq futures rose 77.50 points.
Earnings reports are expected Monday from Mondelez International Inc. (MDLZ) , Rockwell Collins Inc. (COL) , Rambus Inc. (RMBS) , Bloomin' Brands Inc. (BLMN) , Transocean Ltd. (RIG) , Rent-A-Center Inc. (RCII) and Weatherford International PLC (WFT) .
The economic calendar in the U.S. on Monday includes Personal Income and Outlays for September at 8:30 a.m. ET.
2. -- IBM Is Buying Red Hat for $34 Billion
IBM will buy Red Hat for $190 a share, a 63% premium to its closing price on Friday, Oct. 26, of $116.68 and will finance the deal with a mixture of cash and debt. Red Hat shares jumped 51% in premarket trading on Monday to $176.20. IBM declined 3.2%.
Red Hat will become a unit of IBM's Hybrid Cloud division. It will be run by Red Hat CEO Jim Whitehurst.
"The acquisition of Red Hat is a game-changer. It changes everything about the cloud market," said IBM CEO Ginni Rometty. "IBM will become the world's No. 1 hybrid cloud provider, offering companies the only open cloud solution that will unlock the full value of the cloud for their businesses."
The deal is expected to be free cash flow and gross margin accretive within 12 months, IBM said, and will accelerate revenue growth and support a solid and growing dividend.
IBM said, however, it will suspend planned share buybacks in 2020 and 2021 as a result of the acquisition. IBM said it remains "committed to maintaining strong investment grade credit ratings" and will target a leverage profile consistent with "a mid to high single-A" grade.
3. -- Elon Musk Says '420' Tweet Was 'Worth It'
Elon Musk, CEO of Tesla Inc. (TSLA) , said the tweet he sent in August about taking the electric vehicle company private at $420 a share was "worth it."
Musk's latest tweet was sent Friday, an was in response to a question from a Twitter follower.
The CEO was charged last month by the Securities and Exchange Commission with misleading investors when he said he had "funding secured" to take Tesla private. Under a settlement, Musk and the company agreed to pay a total of $40 million in fines and to remove Musk from his role as chairman of the board, without admitting or denying wrongdoing.
Tesla needs to appoint an independent chairman by Nov. 13 under the agreement with the SEC.
On Friday, it was reported by The Wall Street Journal that Tesla faced a criminal investigation into whether the company misstated information about the production of its Model 3 sedans and misled investors about the company's business going back to early 2017.
4. -- Sam's Club to Open a Store Without Cashiers
Walmart Inc.'s (WMT) Sam's Club will open a store in Dallas that will allow the retailer to test technology before it's implemented in stores.
Sam's Club Now will be a 32,000-square-foot store, which is a quarter of the size of an average store operated by the retailer, according to Reuters. It will begin testing technology like electronic shelf labels that automatically will update prices and use 700 installed cameras to better manage inventory.
Sam's Club Now also allows shoppers to use the Scan and Go feature, a technology that allows customers to pay for their goods with an app and without having to wait in a checkout line.
"Sam's Club Now gives us one more avenue to develop, test and refine technology and features that will create new shopping experiences at scale," John Furner, CEO of Sam's Club, told reporters on a conference call.
Amazon unveiled its first cashierless store near its headquarters in Seattle in 2016.
5. -- Red Sox Beat Dodgers to Win World Series
The Boston Red Sox beat the Los Angeles Dodgers 5-1 on Sunday to win the World Series in five games.
The Red Sox victory marked the franchise's fourth World Series title in 15 seasons.
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