Nasdaq Today: M&A Heats Up as Nasdaq Flirts With New Highs

Given that the U.S. stock market was only open until 1 p.m. ET on Wednesday, it’s no surprise that volumes were light. And given that stocks are hovering at or near all-time highs, it’s no wonder that bulls used this light-volume session to notch more gains. Tech tacked on a 0.75% gain for the Nasdaq today, which is oh-so-close to new highs, while the S&P 500 also rose 0.68% to more new highs. 

Nasdaq Today: M&A Heats Up as Nasdaq Flirts With New Highs
Source: Shutterstock

However, it puts us in a precarious situation heading into the end of the week. The stock market will be closed on Thursday for the Fourth of July and reopen for a regular trading session on Friday. But, it’s not just a regular Friday, with the June labor report scheduled for an 8:30 a.m. ET release. 

Economists expect 160,000 jobs to be added to the economy and a beat would usually be good news. In this case though, a beat could drive investors to the conclusion that the Fed will not raise rates later this month. A miss will almost surely trigger bulls to buy stocks on the premise that the Fed will certainly cut rates. After all, the market is pricing it in. It’s more of a “how much” will the cut be, rather than will the Fed actually do it. 

Justified or not, that’s our current market. 

News in the Nasdaq Today

The big news is that Broadcom (NASDAQ:AVGO) is apparently in the middle of trying to acquire Symantec (NASDAQ:SYMC). These reports have thrust shares of SYMC higher, surging more than 13% on the day and past the key $25 level. Shares of Broadcom fell more than 4% on the report, as shares now teeter on a key level

In any regard, the deal emphasizes a few things. The first, Broadcom is continuing its M&A strategy. Before news broke, shares of SYMC were trading at less than 13 times current earnings, giving it a nice, low valuation for AVGO. Symantec sports high-single-digit earnings growth expectations this year and next, and generates solid cash flow. The deal also emphasizes Broadcom’s focus on shifting to software and services, relying less and less on hardware. 

Speaking on the deal, analyst Dan Ives said, “If Broadcom goes down this route we believe there are some significant synergies and cost cutting on the enterprise side, coupled with a cash cow machine on the consumer front.” Analysts from Piper Jaffray and Bernstein also felt good about the deal, so maybe AVGO will be due for a bounce once investors digest the news. 

The other big news? Tesla’s (NASDAQ:TSLA) big delivery report. Last quarter, the company delivered about 63,000 vehicles. The big shortfall crimped profits and squeezed cash flow. Management pegged logistic headaches as the main issue and said it would deliver between 90,000 and 100,000 vehicle in the second quarter. 

Consensus expectations were looking for anything between 88,000 and 90,700. The final tally? 95,200 deliveries. It sent shares higher by 7% in early trading, which faded to a gain of “just” 4.6%. Part of that fade may be because the company’s press release did not comment on full-year guidance or when it would get back to profitability and positive cash flow.

The news also pushed Nio (NASDAQ:NIO) stock higher, which ripped 11%. That’s not completely surprisingly, as we mapped out this recently strong name just the other day. 

Other Winners in the Nasdaq Today

There weren’t many losers in the Nasdaq today, but we saw some strong winners. 


SBUx stock
Source: Chart courtesy of

Starbucks (NASDAQ:SBUX) remains one of the strongest names out there. Shares didn’t flinch in the fourth quarter and have continued to move higher in 10 of the last 12 months. The stock is up 36% so far in 2019 and is up over 78% over the past 12 months. What a beast. 

Source: Chart courtesy of

Ever since Facebook (NASDAQ:FB) announced its Libra cryptocurrency plans, shares have been on fire. Of course, it helps that bitcoin has been pretty hot too. Still, shares are less than $1 away from taking out the April highs, which could ignite a rally to fill the gap back up toward $215. 

chart for the Nasdaq today
Source: Chart courtesy of


Netflix (NASDAQ:NFLX) is also flirting with a move higher. Not all of FANG has been strong, but NFLX is trying to do its part, with a potential move over $380 resistance. It helps that the Nasdaq is adding to its gains over the past few sessions. The index’s highs are now on the table as it maintains above the key 8,100 level.

Let’s see where the jobs report leaves us. 

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AVGO and SBUX. 

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