Finance

Take a look at some of the biggest movers in the premarket:
Nielsen Holdings (NLSN) – The TV ratings company’s stock surged 20.9% in the premarket after it agreed to be acquired by a private-equity consortium for $28 per share. The deal is worth $16 billion, including assumed debt.

FedEx (FDX) – FedEx CEO Fred Smith will step down from that role at the company he founded more than 50 years ago. He’ll become executive chairman on June 1 and will be replaced as CEO by President and Chief Operating Officer Raj Subramaniam. FedEx shares rose 2% in the premarket.
LHC Group (LHCG) – UnitedHealth (UNH) will buy the home health-care specialist for $5.4 billion in cash, or $170 per share, according to The Wall Street Journal. LHC will become part of UnitedHealth’s Optum health-care services unit. LHC shares jumped 7.5% in premarket action.
Uber Technologies (UBER) – Uber is close to an agreement with a San Francisco taxi company to include taxis in its ride-hailing platform in that city, according to people familiar with the matter who spoke to The New York Times. Uber recently struck a similar agreement in New York City. The stock added 1.9% in premarket action.
Jefferies Financial (JEF) – The asset management firm’s stock rallied 3.7% in the premarket after reporting better-than-expected quarterly profit and revenue. Jefferies earned $1.23 per share, well above the 89 cents a share consensus estimate, even as profit fell from a year earlier amid what the company called a “challenging” trading environment.
GameStop (GME) – GameStop remains on watch as the videogame retailer’s stock rides a 10-session winning streak that has seen it gain 143%. Another “meme stock” on a roll is movie theater operator AMC Entertainment (AMC), which surged 45% Monday, its best day since last June. GameStop fell 3.5% in premarket trading, while AMC slid 4.5%.

Stellantis (STLA) – The automaker is laying off an undisclosed number of workers at its Illinois Jeep plant in an effort to “operate the plant in a more sustainable manner.” The plant saw several layoffs last year as well as it tried to deal with the impact of the global semiconductor shortage. Stellantis shares jumped 4.5% in premarket trading.
Southwest Gas (SWX) – The energy producer will sell $400 million in shares at $74 per share to help repay debt used in its $2 billion acquisition of Questar Pipelines in December. That deal had been opposed by investor Carl Icahn, whose offer to buy Southwest at $82.50 per share was rejected by the company on Monday. Southwest fell 3.4% in the premarket.
Dave & Buster’s (PLAY) – The restaurant chain’s stock slumped 5.9% in the premarket after a top and bottom-line miss for its latest quarter. Dave & Buster’s fell 8 cents a share shy of estimates, with quarterly earnings of 52 cents per share. Dave & Buster’s said its results were strong in light of ongoing Covid-19 headwinds.
Pinterest (PINS) – Shares of the image-sharing site operator slid 2.7% in premarket trading after Morgan Stanley downgraded it to “equal-weight” from “overweight.” Morgan Stanley points to challenging user trends, including a greater proportion of time spent on activities with lower monetization potential.

WATCH LIVEWATCH IN THE APP More

Manufacturing, one of the main drivers of China’s growth since the pandemic began, saw slower growth in the first quarter, according to an independent survey by U.S.-based China Beige Book.
“The core problem for manufacturers right now is soft domestic demand and the threat of additional Covid outbreaks, which could further derail growth,” Shehzad H. Qazi, managing director at the China Beige Book, said in an email.

China’s bicycle exports for the first two months of 2022 fell by 16% from a year ago, after growing by 14.9% for all of 2021, according to customs data.
Song Wei | Visual China Group | Getty Images

BEIJING — Manufacturing, one of the main drivers of China’s growth since the pandemic began, saw slower growth in the first quarter, according to an independent survey by China Beige Book.
It’s another sign that China’s economy may not benefit as much from overseas demand as Covid control policies diverge. China’s use of swift lockdowns in early 2020 helped the country quickly reopen businesses while much of the world struggled to contain the virus and resume normal business activity.

However, more countries have adopted a “live with Covid” strategy in the last several months. China has generally maintained a “zero-Covid” policy, although policymakers have tried targeted measures to keep ports or large factories running.
“Until recently, the China-during-Covid story has been heavy reliance on production and exports, even as consumers largely stayed home,” U.S.-based China Beige Book said in a report Tuesday. “This quarter highlights the potential limits of that reliance.”
The firm surveyed more than 4,300 businesses in China, mostly in the month through March 16. The report is an early look at the first quarter, which isn’t over yet, and only included proprietary trend analysis.

The core problem for manufacturers right now is soft domestic demand and the threat of additional Covid outbreaks, which could further derail growth.

Shehzad H. Qazi
China Beige Book, managing director

Retail businesses saw double-digit year-on-year declines in the rate of revenue and profit growth, as well as a slowdown in hiring, the China Beige Book survey found.
“Manufacturing is clearly in better shape but revenue, profit, and new domestic order growth are all slower than Q1-2021,” the report said.

Official figures from the National Bureau of Statistics of China released earlier this month showed surprisingly upbeat data for January and February, with faster-than-expected growth in retail sales, industrial production and fixed asset investment.

However, China’s exports grew by 16.3% in the first two months of the year from a year ago. That’s slower than the 29.9% growth in 2021.
Data for March and the first quarter are due out April 18.
“The core problem for manufacturers right now is soft domestic demand and the threat of additional Covid outbreaks, which could further derail growth,” Shehzad H. Qazi, managing director at the China Beige Book, said in an email. “Logistics companies are reporting a jump in their backlog of work, but there isn’t as yet any evidence of major supply chain logjams.”
Overall, the survey found that major government stimulus for the economy has yet to arrive, while the pace of borrowing fell to the lowest on record in the China Beige Book’s 10-year history.

Real estate bright spots

On China’s struggling property sector, the survey found the industry was doing better than headlines might indicate, especially in China’s largest cities like Beijing and Shanghai.
“Accelerating profits say the sector is simply doing better than most observers realize,” the report said, without providing specific figures. “The housing market did fare worse than construction, with revenues and sales growth slowing despite better prices.”
The real estate sector and related industries account for about a quarter of China’s GDP, according to Moody’s. Developers like Evergrande have defaulted in the last several months as falling sales cut into the amount of cash companies have on hand to pay back investors on large levels of debt.

Read more about China from CNBC Pro

Economists have said the ultimate impact of Covid-related lockdowns — most recently in Shenzhen and Shanghai — depends on whether they last for two weeks or more than a month.
Last year, many economists also predicted a slowdown in exports last year, which did not materialize.
Even a forecast of slower export growth in March by Nomura’s chief China economist Ting Lu is a double-digit figure — a 14.1% year-on-year increase. He expects industrial production will rise by 4.5% in March from a year ago, slower than the 7.5% year-on-year pace reported for the first two months of the year.
For the full year, Lu predicts 4.3% growth in GDP, as of a report Monday. That’s below the “around 5.5%” target Beijing announced earlier this month.

WATCH LIVEWATCH IN THE APP More

The operator of Domino’s Pizza stores in China, DPC Dash, applied Monday to go public on the Hong Kong stock exchange, according to an online filing.
U.S.-listed franchisor Domino’s Pizza has a 15.7% stake in DPC as of the filing date through wholly-owned entities, the document showed. No one entity has majority ownership.
DPC has operated at a growing net loss over the last three years, which the filing attributed to spending on new stores, central kitchens, marketing and staff training.

DPC Dash said in a filing it is Domino’s Pizza’s “exclusive master franchisee” in mainland China, Hong Kong and Macao, with 485 directly operated stores in 10 cities on the mainland — mostly in Beijing and Shanghai.
Sopa Images | Lightrocket | Getty Images

BEIJING — The operator of Domino’s Pizza stores in China, DPC Dash, applied Monday to go public on the Hong Kong stock exchange, according to an online filing.
U.S.-listed franchisor Domino’s Pizza has a 15.7% stake in DPC as of the filing date through wholly-owned entities, the document showed. No one entity has majority ownership.

Much of the key information on pricing and timing were redacted in the publicly available document, as the listing has yet to occur. Bank of America Securities is the sole sponsor of the listing, according to the application.
DPC said in the filing it is Domino’s Pizza’s “exclusive master franchisee” in mainland China, Hong Kong and Macao, with 485 directly operated stores in 10 cities on the mainland — mostly in Beijing and Shanghai. The company said it plans to open 120 new stores this year.
Same store sales grew by 18.7% in 2021. But the company has operated at a growing net loss over the last three years, which the filing attributed to spending on new stores, central kitchens, marketing and staff training.

New stores take about one to three months to break even, with a typical cash investment payback period of three to four years, the filing said, noting shorter times for new stores in Beijing and Shanghai.
In 2021, more than 73% of revenue was generated by delivery orders, the filing said. The company said it hires dedicated drivers — a staff of 5,375 in 2021 — to meet a delivery promise of 30 minutes.

DPC warned about numerous business risks, including that of Covid-related restrictions.
Yum China, which operates Pizza Hut in China, warned on March 14 that same-store sales fell by about 20% year-on-year for the first two weeks of the month due to Covid. That was before the latest Shanghai lockdown announced this week.

WATCH LIVEWATCH IN THE APP More

Yokoy, a Swiss start-up helping companies manage their expenses, has raised $80 million in a financing round led by Sequoia Capital.
The deal values the three-year-old company at more than $500 million, a person familiar with the matter told CNBC.
Yokoy will use the fresh cash to pursue expansion in Europe. Further down the line, the company also has ambitions to enter the U.S.

The Yokoy platform.

Sequoia Capital is betting the next European tech giant will emerge in Switzerland.
The Silicon Valley venture capital firm told CNBC that it led an $80 million funding round for Yokoy, a platform that helps large companies manage their expenses, invoicing and credit card processing. Previous investors Left Lane and Balderton Capital also took part in the round.

The deal values the Zurich-based company at more than $500 million, a person familiar with the matter told CNBC. The person preferred to remain anonymous discussing commercially sensitive information.
Founded in 2019, Yokoy sells its software to mainly large businesses, including the postal service DPD and train manufacturer Stadler. It’s competing with giants in the world of expense management like SAP and Coupa Software.
“Most of our customers tend not to have an enterprise-level spend management solution,” Philippe Sahli, Yokoy’s CEO and co-founder, told CNBC, adding its target clients typically rely on “siloed” IT systems that are isolated from other parts of the business.
Yokoy will use the fresh cash to pursue expansion in Europe — it recently opened up an office in the Netherlands — and hire more staff. With the help of Sequoia, the company aims to eventually enter the U.S. “I think it makes total sense,” Sahli said.
Matt Miller, Sequoia’s partner in London, said what attracted the firm to Yokoy was its use of artificial intelligence to automate spend management processes.

“AI and automation have a meaningful role to play in refining this piece of the enterprise experience and can save companies a lot of money,” Miller told CNBC.
Sequoia, an early investor in companies ranging from Apple to Swedish fintech giant Klarna, has been expanding its reach in Europe lately. The company opened an office in London last year and has hired a number of partners there to scout out new deals in the region.
Switzerland has a lot to offer when it comes to digital innovation, according to Miller. Google has a large engineering and development presence in Zurich, for example.
“We’ve found Switzerland to be an incredible place filled with incredible talent,” Miller said. “Compared to five or six years ago, there’s a lot more entrepreneurial zeal developing.”
Still, Switzerland has a long way to go. It’s currently home to only five “unicorn” start-ups with a valuation of $1 billion or more, lagging behind neighboring France and Germany. Yokoy is Sequoia’s second Swiss start-up bet to date; the firm previously invested in Ledgy, a Zurich-based equity management platform.

WATCH LIVEWATCH IN THE APP More

Stock futures were flat in overnight trading ahead of Tuesday’s consumer confidence data and a big week for economic data.
Futures on the Dow Jones Industrial Average and S&P 500 were flat, while Nasdaq 100 futures inched 0.1% lower.

During Monday’s regular trading session, the Dow Jones Industrial Average rose 94.65 points or 0.27%. The S&P 500 climbed 0.7%, while the Nasdaq Composite gained 1.31%.
The gains came amid a tech-heavy market rally during regular trading led by shares of Tesla, which rose 8% on news that it will ask shareholders to split its stock to pay dividends to investors.
“I think anyone has to be impressed with the resiliency of the market and I go back to there is no alternative,” Erin Browne, PIMCO’s managing director and portfolio manager told CNBC’s “Closing Bell: Overtime” on Monday. “Do you want to invest in bonds when you know that the Fed is raising rates or do you want to invest in equities where you can get some type of dividend return, you can get real earnings growth and it’s gonna give you a comfortable return in your portfolios?”
Meanwhile, the 5-year Treasury note rose above the 30-year on Monday, marking the first inversion since 2006. The shift stoked some recession fears, although economists typically watch the spread between the 2-year and 10-year rate, which remains positive.

Stock picks and investing trends from CNBC Pro:

WATCH LIVEWATCH IN THE APP More

Monday – Friday, 5:00 – 6:00 PM ET

Fast Money Podcast
Full Episodes

Wall Street may be overestimating recession risks.
While investors focus on an unnerving inversion between the five-year and 30-year Treasury Note yields, Canaccord Genuity’s Tony Dwyer is concentrating on optimistic activity in another part of the bond market.

According to Dwyer, the three-month versus five-year yield shows a healthier picture of the U.S. economy because it steepened.
“It measures the difference between what a banker lending institution gets its money at, what they have to pay, versus what they charge or invested at,” the firm’s chief market strategist told CNBC’s “Fast Money” on Monday. “We don’t look for a recession because of that yield curve that’s driving the lending is still very positive.”
Dwyer acknowledges the overall bond market is reflecting economic challenges — but not enough to spark a recession.
“The fear is definitely there. Asia seems to be a mess with more lockdowns. Europe is heading toward a recession, if not in one because of the once in a generation ground war there,” he said. “The U.S. is being affected by higher rates. So, it certainly is slowing down.”
Dwyer expects the Federal Reserve to continue raising rates over the next few months.

“There’s no question inflation is high. Rates are going higher,” Dwyer said. “The Fed is in a box. No matter the slowdown, they’ve got to raise rates.”
He sees stocks as a hedge against inflation and plans to buy around weakness. Based on historical trends during similar backdrops, Dwyer believes the S&P 500 will be significantly higher this time next year.
But for now investors may want to brace themselves for wild market swings.

“We call it tumultuous”

“We call it tumultuous,” said Dwyer, who believes volatility is an opportunity.
He lists interest rate sensitive plays Big Tech and utilities as his best contrarian ideas. Dwyer predicts the slowing economy will provide some inflation relief in the year’s second half and put Fed rate hikes on pause.
“The market seems to be almost pricing in a recession trade because the areas that should do the best with higher rates have been lagging,” Dwyer said.
The S&P 500 closed at 4,575.52 on Monday and is off 4% so far this year.
Disclaimer

WATCH LIVEWATCH IN THE APP More

A Tesla Supercharger station in Vallejo, California, U.S., on Tuesday, Oct. 19, 2021.
David Paul Morris | Bloomberg | Getty Images

Check out the companies making headlines in midday trading.
Tesla — Tesla shares gained 8% on Monday following news that the electric vehicle maker will ask shareholders at its annual meeting to authorize a stock split in order to pay stock dividends to investors.

Coinbase — Shares of the cryptocurrency services firm rose 7.8% following a report by a local newspaper that the company is in a talks to buy 2TM, the parent of the Brazilian cryptocurrency brokerage Mercado Bitcoin, and that the potential deal could be closed by the end of April. The move also coincides with a significant move higher in the bitcoin price over the weekend that erased its 2022 losses.
AMC Entertainment — The movie theater company saw shares surge 44.9% after its CEO Adam Aron said more “transformational” M&A deals are coming. The comments followed news about the company’s investment in Hycroft Mining, a gold and silver mining operator, earlier in the month.
Poly, HP Inc — The communications technology company saw a 52.6% spike in its share price Monday following news that it will be acquired by HP Inc. for $40 per share, in a deal that both companies expect to be completed by the end of this year. Shares of HP lost 2.7%.
Foot Locker — The athletic apparel retailer’s shares dropped 1% after Cowen urged investors not to get too enticed by the pullback in their price. The firm downgraded Foot Locker to market perform from outperform and cut its price target on the stock to $34 from $42.
Beyond Meat — Shares of the meat alternative producer slid more than 2% before turning higher after Piper Sandler downgraded the stock to underweight from neutral. The firm also cut its price target on Beyond, seeing 40% downside.

Campbell Soup — The soup company’s shares fell about 1.3% before reclaiming some of its losses after RBC downgraded the company to sector perform from outperform. The firm said it’s concerned about Campbell’s exposure to inflation.
Altria Group — RBC also downgraded Altria, the tobacco and cigarette giant that owns Philip Morris, to sector perform from outperform, noting that it sees limited room for upside for the company. Altria shares dropped 2.9%.
Duckhorn Portfolio — The winemaker’s shares jumped 8.1% after RBC upgraded them to outperform from sector perform, noting that they have minimal exposure to inflation and about 32% upside from where they ended the trading session Friday.
Chipmakers — Chipmakers’ shares were lower Monday after Goldman Sachs downgraded three stocks — Qorvo, Microchip and Teradyne — to neutral from buy noting that it sees a “challenging macro backdrop” over the next year. Qorvo fell more than 4%. Microchip Technology slid 1.8%, and Teradyne lost about 2.8% before paring losses. Several other stocks within the sector declined, too before turning higher.
 — CNBC’s Samantha Subin and Hannah Miao contributed reporting.

WATCH LIVEWATCH IN THE APP More

Take a look at some of the biggest movers in the premarket:
Tesla (TSLA) – Tesla will ask shareholders to authorize the issuance of additional shares at the upcoming annual meeting so it can pay a stock dividend, according to a company tweet. The additional shares would enable the company to split its stock. Tesla jumped 5.4% in the premarket.

Beyond Meat (BYND) – Beyond Meat slid 5.1% in the premarket after Piper Sandler downgraded the stock to “underweight” from “neutral.” Piper points to increasing competition for plant-based meat substitutes, as well as lower positive expectations for the impact of a nationwide McDonald’s (MCD) launch.
Coinbase (COIN) – The cryptocurrency exchange operator is reportedly near a deal to buy 2TM, the parent of Brazilian cryptocurrency brokerage Mercado Bitcoin, according to a local newspaper. The paper said a deal could be closed by the end of April. Coinbase rallied 4.2% in the premarket.
Apple (AAPL) – Apple will reportedly cut planned iPhone SE output by 20% next quarter, according to a report by Japan’s Nikkei news service citing weaker-than-expected demand. Apple fell 1.2% in premarket trading.
Poly (POLY) – The communications technology company agreed to be acquired by HP Inc. (HPQ) for $40 per share, compared to Poly’s Friday close of $26.20 per share. The companies expect the deal to close before the end of this year.
Foot Locker (FL) – The athletic footwear and apparel retailer’s stock fell 1.7% in premarket trading after Cowen downgraded it to “market perform” from “outperform.” Cowen said despite an inexpensive valuation, investors may be underappreciating the potential impact of inflation.

Barclays (BCS) – Barclays lost 3.1% in premarket action after the British bank disclosed a loss of nearly $592 million stemming from mishandled bond trades. It also said it would delay a planned share buyback as a result.
AMC Entertainment (AMC) – AMC CEO Adam Aron told Reuters the company would strike more “transformational” deals, following its $27.9 million investment in gold and silver mine operator Hycroft Mining (HYMC) earlier this month. AMC added 2.2% in the premarket, while Hycroft – a microcap stock with a market value of $77.3 million as of Friday’s close – surged 32.8%.
Uber Technologies (UBER) – Uber won a new 30-month license to operate in London. The ride-hailing service had been engaged in a dispute with regulators over the past five years over safety issues and had lost its license to operate twice over that period.
Hasbro (HAS) – Hasbro turned down a settlement offer with activist investor Alta Fox Capital over board nominees, according to people familiar with the matter who spoke to Reuters. Alta Fox holds a 2.5% stake in the toymaker, and the two sides have been negotiating to avoid a proxy contest.
CORRECTION: This article has been updated to correct Piper Sandler downgrading Beyond Meat to “underweight” from “neutral.”

WATCH LIVEWATCH IN THE APP More