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Jun.04

8:43 AM ET

Monday, 4 Jun 2007

CNBC's Domm: Today's Agenda in the Markets

Posted By:Patti Domm

Sectors:Retail | Utilities

Stocks are weaker ahead of the open despite a round of Monday morning mergers. Asian markets were higher, ignoring another selloff in China overnight, and European markets are lower.

China's efforts to stamp out speculators in its stock market with a tax hike continue to weigh on Shanghai shares, which tumbled 8%. Wall Street is likely to once more shake off the action in that market. After today's drop, Shanghai is still up more than 70% year to date.

Investors are also keeping a sharp eye on the bond market, where rates inched up Friday to the highest levels since last August.

Merger Monday

There were plenty of headlines today from new and ongoing takeover sagas. In one continuing drama, Rupert Murdoch today meets with the Dow-Jones-controlling Bancroft [DJ Loading... () ] family to discuss News Corp's [NWS Loading... () ] $5 billion for the company. Bancroft family members last week said they would talk to Murdoch as well as discuss other options. The issue of editorial independence appears to be a key in the talks.

In the energy patch, Dominion [D Loading... () ] says it is selling most of its U.S. onshore natural gas and oil exploration and production operations for a total $6.5 billion. Loews Corp. [LTR Loading... () ] is buying the Permian Basin, Michigan and Alabama operations and XTO Energy [XTO Loading... () ] is buying Dominion's operations in the Rocky Mountains, Gulf Coast San Juan Basin and South Louisiana.

Flextronics [FLEX Loading... () ] said it is buying Solectron [SLR Loading... () ] for $3.6 billion, and the Wall Street Journal reports that private equity firms TPG and Silver Lake were in the lead to buy Avaya [AV Loading... () ] for $17 a share.

Palm, [PALM Loading... () ] rumored for months to be a buyout candidate, is selling a 25% stake to Elevation Partners for $325 million. The complicated transaction is aimed at helping Palm battle competitors in the smart phone market, and key to the deal is the new personnel Elevation brings with it. Jon Rubinstein, a former Apple executive who ran the iPod division, will join Palm as executive chairman as pat of the deal.

Speaking of Apple, [AAPL Loading... () ] the much anticipated release of the iPhone will be June 29. The phone will retail between $499 and $599 and will be available only through AT&T wireless.

Selling Hope

Pharmaceutical shares will be a focus as news on cancer drugs comes out of the American Society of Clinical Oncology meeting in Chicago. Plenty of headlines were released over the weekend. Our Mike Huckman is covering the conference and on "Squawk on the Street" he will be speaking with the CEO of Onyx. Onyx [ONYX Loading... () ] released data on the use of its kidney cancer drug for liver cancer, and its stock is flying already this morning.

Wal-Mart

Retail giant Wal-Mart [WMT Loading... () ] is winning favor on Wall Street this morning with its plan to cut capital spending and return more capital to shareholders. Wal-Mart told shareholders Friday it plans to open or relocate 190 or 200 stores, paring back its previous plan of 270 new stores. J.P. Morgan, HSBC, Morgan Stanley and Wachovia all had positive things to say today about the stock which is moving higher before hours.

Around the World

Russian President Vladimir Putin threatened to retarget Russia's missiles toward Europe if Washington goes ahead with plans to install an antimissile shield in some former Soviet countries. These comments chill the air ahead of this week's G8 in Germany.

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