Stocks in the U.S. are looking for direction this morning as Europe trades mostly higher and Asian stocks were mixed overnight. Lots of deal news and earnings reports are making headlines this morning, and investors await a heavy menu of economic data and a Fed meeting later in the week.
MERGER MONDAY: Reuters reports from Paris that Sanofi and Bristol-Myers could be announcing a friendly deal. Reuters says the report is unsourced and appears in a French financial newsletter La Lettre de L'Expansion. Bristol is rising on the report, and it is long thought to be a potential merger partner. It's sketchy but we will keep an eye on it. In real deals today, Citigroup is buying Prudential UK's internet bank Egg for $1.13 billion. Abitibi and Bowater agreed to a deal valued at over $1 billion. US Air is willing to up its bid for Delta, according to a Wall Street Journal report quoting sources.
VISTA ON THE HORIZON: It's a big week for Microsoft as its Vista operating system finally lands in stores Tuesday. We'll look at what the rollout and product means for Microsoft and the computer industry and also the consumer reaction. Microsoft Chairman Bill Gates went on the Today Show this morning to discuss Vista and CEO Steve Ballmer talks to Bill Griffeth on "Power Lunch."
OIL ON A ROLL: Oil prices was firmer overnight but gave up gains despite the dusting of snow on the NYMEX. Sharon Epperson will keep track of the market action today, and Melissa Francis will examine the Saudi role in OPEC. Coincidentally, there was an interesting New York Times story Sunday on Saudi officials seeking to hold the price of oil in the $50 a barrel range. The Times analyzed the way Saudi Arabia's oil minister delivered the message and the reasons why, including concerns that higher prices would slow down the world economy.
CNBC Energy analyst Daniel Yergin, who heads Cambridge Energy Research, checked out the article for us on his way out of Davos and thought it spot on but elaborated a bit. "The Saudis focus on inventory levels and trends rather than a specific price. They are also very attentive to oil demand, both short-term and long-term, and the trends they're seeing there would certainly affect their thinking on price. After all, they have a long-term memory that many other exporters do not," he wrote. Yergin tells us the Saudi economy is ok with $50 oil. But check out the Wall Street Journal piece today. It takes an look at which countries are affected by a drop in oil prices, namely Venezuela, Iran and Russia.
CHIPS AHOY: Intel is unveiling a speedier and more energy efficient chip today that uses a whole different technology. IBM is working with Intel AMD on a high velocity chip of its own. We'll hear more about these today. Intel company researchers were quoted over the weekend as saying the advance in chip technology is the most significant change in the materials used to make silicon chips since Intel first pioneered modern integrated circuit transistors 40 years ago. The new chips could be used in computers or for consumer devices, like cell phones that would play video more effectively.
Verizon and Schering-Plough are out with earnings today. USA Today reports that Verizon turned down Apple's offer to be the sole distributor of iPhone because of Apple's financial demands.
Lowe's and Home Depot were upgraded to buy from hold at AG Edwards.