U.S. equities finished with a mixed day Monday led by a slight gain in the utility sector but a drop in tech stocks. The S&P 500 Index ticked marginally higher and the Dow Jones Industrial Average improved by 0.1%, but the Nasdaq Composite declined by 0.3%.
While this week will see the last gasps of the first-quarter earnings season, a few companies are making headlines on some different merits. Alphabet Inc (NASDAQ:GOOGL) is being taken down a notch on the European front, while Sprint Corp (NYSE:S) is in partnership talks and Western Digital Corp (NASDAQ:WDC) is sliding despite some very positive news.
Here’s a look at what you should be watching today:
Alphabet Inc (GOOGL)
GOOGL shares are down solidly Tuesday on news that European Union regulators have hit Alphabet search division Google with a record antitrust fine. This comes a day after shares fell more than 1% on worries that the penalty was likiely.
European Commission official Margrethe Vestager says Google “denied other companies the chance to compete on the merits and to innovate. And most importantly, it denied European consumers a genuine choice of services and the full benefits of innovation.”
This stems from a case in which Google gave preferential treatment to its own shopping sites and pushed rival services lower.
Google must pay a fine of $2.7 billion — though that’s a fraction of the $9 billion maximum penalty the commission could have lobbed Alphabet’s way. However, the figure could grow should it not alter its behavior within the next 90 days.
Alphabet currently is considering an appeal.
GOOGL shares are off more than 1% in Tuesday’s morning trade, to about $960, putting shares even further away from the $1,000 mark breached momentarily earlier this month.
Sprint Corp (S)
A Reuters report says that sources familiar with the matter have revealed talks among the three companies to “boost (Charter and Comcast’s) wireless offerings.” Charter and Comcast already announced a partnership in May to expand their businesses in the wireless space, with the latter currently planning to roll out wireless service using Verizon Communications Inc. (NYSE:VZ) airwaves.
A Wall Street Journal report says that an agreement could include an equity stake in Sprint, which has put merger talks with T-Mobile US Inc (NASDAQ:TMUS) on hiatus until July, though any deal wouldn’t prevent Sprint from continuing to seek out a deal after that time.
Sprint stock, which is down more than 4% versus a 9% gain for the S&P 500, is up about 4% in Tuesday’s morning trade.
Western Digital Corp (WDC)
Western Digital shares are suffering a setback this morning despite a positive update to the company’s outlook for its fiscal fourth quarter.
The maker of hard drives and NAND chips didn’t move its revenue expectation of $4.8 billion, but it did tick its gross profit margin a point higher to 41% of sales, while its earnings projection of $2.85 per share is much better than an original range of $2.55 to $2.65. For the full year, the company expects to earn $12 per share.
The driver of the update is better-than-expected sales of storage across the board, but with a particular emphasis on “flash-based devices and solutions and the 10 terabyte helium capacity hard drives.”
This comes amid news this morning that Western Digital and KKR & Co. L.P. (NYSE:KKR) have resubmitted a bid to buy out the flash memory chip unit of Toshiba Corp (USA) (OTCMKTS:TOSYY), the struggling Japanese electronics giant.
Nonetheless, WDC stock is off by about 2% this morning, following a fractional loss Monday. The company is shedding a little froth after more than 35% gains for the year-to-date.