1. IBM’s big deal: IBM announced Sunday it is buying open software company Red Hat for $34 billion.
Shares in Red Hat (RHT) soared more than 50% in premarket trading.
The deal means that IBM (IBM) will start providing technology to its biggest competitors, including Amazon (AMZN), Microsoft (MSFT) and Google (GOOGL). Red Hat partners with all of them, and IBM said it will continue the partnerships after the acquisition and work to expand on them.
The acquisition still needs approval from shareholders and regulators and is expected to close in the second half of 2019.
2. HSBC delivers: Shares in HSBC (HSBC) jumped over 4% in London after the bank reported a 28% increase in profits before tax in the third quarter.
HSBC, Europe’s biggest bank by assets, said that cost cutting had boosted its results.
“We are doing what we said we would — delivering growth from areas of strength, and investing in the business while keeping a strong grip on costs,” CEO John Flint said in a statement.
3. China opening: British bank Standard Chartered (SCBFF) says it’s the first foreign lender to receive a license to hold and safeguard the assets of local investors in China.
The license allows the bank to act as a custodian for investment products sold by local funds and asset managers.
“This is a big step forward in the further opening up of China’s domestic financial markets and a testament to our commitment to supporting China’s financial reform and innovation,” said Jerry Zhang, CEO of Standard Chartered in China.
The bank’s stock was trading 1.9% higher.
4. Brexit budget: UK treasury chief Philip Hammond will reveal his budget on Monday, the final edition before Brexit.
The United Kingdom and the European Union still haven’t been able to agree the terms of the divorce and their future trading relationship. A messy break up would have major implications for the UK budget.
The pound was trading 0.2% lower against the US dollar at $1.28.
5. Global market overview: US stock futures were mixed.
European markets opened mostly higher. The main stock market in Italy gained 1.4% after the country escaped a credit rating downgrade by Standard & Poor’s.
The ratings agency revised its outlook for Italian government debt on Friday to negative from stable, but kept its credit rating on hold.
Stocks in Asia finished mixed. Markets in Korea and mainland China lost ground, while Hong Kong closed higher.
The US Bureau of Economic Analysis will publish its personal consumption expenditure report for September at 8:30 a.m. ET.
7. Coming this week:
Monday — Mondelez (MDLZ) and Wingstop (WING) earnings
Tuesday — Electronics Arts (EA), Under Armour (UAA), Aetna (AET), Caesars Entertain Group (CZR), Tribune (TPCO), Coca-Cola (KO), Hyatt (H), Denny’s (DENN), Fiat Chrysler (FCAU), Cheesecake Factory (CAKE), eBay (EBAY), Herbalife Nutirtion (HLF), GE (GE), Yelp (YELP), T-Mobile (TMUS), Sony (SNE) earnings; Apple product event in Brooklyn
Wednesday — Allstate (ALL), Anthem (ANTM), Yum! Brands (YUM), Dine Brands (DIN), Express Scripts (ESRX), Clorox (CLX), General Motors (GM), Fitbit (FIT), Pandora Media (P), NXP Semiconductors (NXPI) earnings
Thursday — Apple (AAPL), AMC Networks (AMC), Progressive (PGR), CBS (CBS), Cigna (CI), Starbucks (SBUX), Shake Shack (SHAK), Kraft Heinz (KHC), GoPro (GPRO), Wayfair (W), IHeartMedia (IHRTQ), and Spotify (SPOT) earnings
Friday — Chevron (CVX), Exxon (XOM), Newell Brands (NWL), United States Steel Corp (X), MSG Networks (MSGN), and Seagate Technology (STX) earnings; Jobs report