Mid-Morning Market Update: Markets Open Higher; IBM To Buy Red Hat In $34B Deal

Following the market opening Monday, the Dow traded up 1.31 percent to 25,012.66 while the NASDAQ climbed 1.7 percent to 7,289.15. The S&P also rose, gaining 1.74 percent to 2,704.90.

Leading and Lagging Sectors

Monday morning, the financial shares rose 1.5 percent. Meanwhile, top gainers in the sector included Genworth Financial Inc GNW up 20 percent, and Codorus Valley Bancorp, Inc. CVLY up 10 percent.

In trading on Monday, energy shares rose by just 0.4 percent.

Top Headline

IBM Common Stock IBM announced it will purchase Red Hat Inc RHT's issued and outstanding common shares for $190 per share in cash.

The $34 billion deal — the culmination of a 20-year partnership — prompted a 51-percent pop in Red Hat, a 2.7-percent decline in IBM.

Equities Trading UP

Red Hat Inc RHT shares shot up 48 percent to $173.20. IBM announced plans to acquire Red Hat in a $34 billion deal, including debt.

Shares of Dicerna Pharmaceuticals Inc DRNA got a boost, shooting up 15 percent to $14.98 after reporting a licensing and research collaboration with Eli Lilly for the development and commercialization of new medicines in cardio-metabolic disease, neurodegeneration and pain.

Electrameccanica Vehicles Corp SOLO shares were also up, gaining 153 percent to $5.52. The company earlier issued press release highlighting pre-orders for its vehicles exceeded 64,000 units.

Equities Trading DOWN

Tower Semiconductor Ltd. TSEM shares dropped 15 percent to $15.14 after the company missed Q3 EPS and sales estimates.

Shares of Denbury Resources Inc. DNR were down 14 percent to $3.74 after the company announced plans to acquire Penn Virginia for $79.80 per share.

First Data Corporation FDC was down, falling around 10 percent to $19.45 after reporting downbeat earnings for its third quarter.

Commodities

In commodity news, oil traded down 0.19 percent to $67.46 while gold traded down 0.20 percent to $1,233.30.

Silver traded up 0.48 percent Monday to $14.77, while copper rose 1.15 to $2.7725.

Eurozone

European shares were higher today. The eurozone’s STOXX 600 gained 1.71 percent, the Spanish Ibex Index rose 1.53 percent, while Italy’s FTSE MIB Index surged 2.4 percent. Meanwhile the German DAX climbed 2.07 percent, and the French CAC 40 surged 1.18 percent while U.K. shares rose 1.94 percent.

Economics

U.S. consumer spending rose 0.4 percent for September, versus economists’ expectations for a 0.4 percent gain. Personal income increased 0.20 percent in September.

The Dallas Fed manufacturing index for October is schedule for release at 10:30 a.m. ET.

The Treasury is set to auction 3-and 6-month bills at 11:30 a.m. ET.