[BRIEFING.COM] The major averages sit at session lows at midday. 

Paramount Skydance's (PSKY 14.26, +0.90, +6.73%) hostile $30/share all-cash bid for Warner Bros. Discovery (WBD 27.12, +1.04, +3.99%) writes a new chapter in this takeover saga, directly challenging WBD's earlier $27.75/share cash-and-stock agreement with Netflix (NFLX 96.02, -4.22, -4.21%) valued at about $82.7 billion.

The Paramount-Skydance proposal offers a richer premium, greater deal certainty, and a structurally simpler path to closing, raising the odds that WBD shareholders will push hard for serious consideration of the new offer. Netflix may also now be forced to "up the ante" by raising its bid or sweetening terms-potentially with more cash-to keep WBD shareholders onside and get its deal across the finish line

[BRIEFING.COM] The S&P 500 (-0.3%), Nasdaq Composite (-0.2%), and DJIA (-0.2%) are modestly lower shortly before midday, giving up slight gains from earlier as the information technology sector (-0.6%) struggles to lift the major averages against a backdrop of broader-market weakness. 

The technology sector has given up just under half of its early gain but remains firmly higher. Microsoft (MSFT 490.95, +7.79, +1.61%) and Broadcom (AVGO 397.67, +7.43, +1.90%) provide solid leadership across the sector's largest components after The Information reported that Microsoft is in talks to shift its custom chips business to Broadcom. 

Mega-caps are lower across the board outside of the technology sector, with Tesla (TSLA 438.57, -16.43, -3.61%) a notable laggard after Morgan Stanley assumed coverage on the stock and downgraded it to Equal Weight from Overweight, pushing the consumer discretionary sector (-1.4%) lower. 

The communication services sector (-1.4%) holds a similar loss as Alphabet (GOOG 316.16, -5.93, -1.84%) and Meta Platforms (META 669.48, -3.94, -0.59%) provide weak leadership. The Vanguard Mega-Cap Growth ETF is down 0.4%. 

Mega-caps are not the only point of weakness in the market, however, as nine S&P 500 sectors trade lower. Decliners outpace advancers by a roughly 8-to-5 ratio on the NYSE and a roughly 7-to-6 clip on the Nasdaq. 

The small-cap Russell 2000 (+0.1%) outperforms with a slight gain, while the S&P Mid Cap 400 (-0.3%) holds a loss similar to that of its larger-cap counterparts. 

[BRIEFING.COM] The S&P 500 (-0.3%), Nasdaq Composite (-0.2%), and DJIA (-0.4%) now all sit in negative territory as losses in the broader market outweigh the slightly eroded gains of the top-weighted information technology sector (+0.7%). 

IBM (IBM 310.55, +2.61, +0.85%) is among the tech names that trade higher today afte the company entered an agreement to acquire Confluent (CFLT 29.72, +6.58, +28.44%) for $31 per share in cash, representing an $11.0 billion enterprise value, pushing IBM deeper into real-time data and AI infrastructure while giving CFLT a premium takeout and immediate validation of its strategic relevance. The deal looks attractive from a revenue and profitability standpoint for IBM, but integration risk, valuation, and competitive dynamics in data streaming and AI are key watch points.

In other stock-specific moves, Carvana (CVNA 437.63, +37.86, +9.47%) and CRH Plc. (CRH 125.81, +6.32, +5.29%) are both sharply higher today after news that the companies will join the S&P 500. 

[BRIEFING.COM] The Nasdaq Composite (flat) is now defending its flatline while the S&P 500 (-0.2%) and Nasdaq Composite (-0.2%) both slip lower. 

Tesla (TSLA 443.75, -11.25, -2.47%) is a laggard across mega-cap names today after Morgan Stanley assumed/downgraded coverage on the stock at Equal Weight from Overweight.

Netflix (NFLX 95.88, -4.36, -4.35%) also lags after receiving a downgrade this morning. Rosenblatt downgraded the stock to Neutral from Buy, citing heightened uncertainty and risks pertaining to the Warner Bros. Discovery (WBD 27.58, +1.50, +5.75%) acqusition.

[BRIEFING.COM] The major averages sit mixed shortly after the open, with solid but thin leadership coming from the information technology sector (+0.9%). The tech-heavy Nasdaq Composite (+0.2%) in turn outperforms the S&P 500 (flat) and DJIA (-0.1%) in the early going. 

NVIDIA (NVDA 183.56, +1.15, +0.63%) and Microsoft (MSFT 489.09, +5.93, +1.23%) provide the sector with strong mega-cap leadership, while chipmakers such as Broadcom (AVGO 399.50, +9.26, +2.37%) and Micron (MU 246.90, +9.68, +4.08%) contribute to a 1.1% gain in the PHLX Semiconductor Index. 

Meanwhile, the industrials sector (+0.3%) holds a more modest gain, while the nine other S&P 500 sectors move lower. 

Losses are contained to within 1.0%, with the exception of the communication services sector (-1.0%). Alphabet (GOOG 318.92, -3.17, -0.98%) and Meta Platforms (META 667.85, -5.57, -0.83%) both move lower while Netflix (NFLX 97.26, -2.98, -2.97%) is a laggard as it faces regulatory approval concerns in its accepted bid to acquire Warner Bros. Discovery (WBD 27.80, +1.72, +6.58%).

The stock market is on track for a higher opening to start the week after the major averages have notched gains in the past two consecutive weeks. On Friday, the S&P 500 closed just 0.7% off of its all-time high from October 29. 

Meanwhile, the Nasdaq Composite is 1.8% off of a record high of its own, while the DJIA has 4.5% to gain before notching a new record.

In M&A news, IBM (IBM 308.15, +0.21, +0.1%) confirms plans to acquire Confluent (CFLT 29.91, +6.77, +29.3%) for $31 per share, representing an enterprise value of $11 billion. Confluent will be acquired with available cash on hand.

The S&P 500 futures currently trade eleven points above fair value. 

Equity indices in the Asia-Pacific region started the week on a mixed note with a relative lack of news catalysts. Attention turned mostly to the economic calendar, which featured better-than-expected export data for November out of China and a downward revision to Japan's Q3 GDP to -0.6% qtr/qtr from the preliminary estimate of -0.4%. Market participants are also waiting on this week's central bank meetings, starting with the RBA meeting tomorrow (expected to leave cash rate unchanged) and highlighted by the FOMC decision (25-basis-point cut expected) on Wednesday.

• In economic data:
  • China's November FX Reserves 3.346 trln yuan (expected 3.360 trln; prior 3.343 trln); November exports 5.9% yr/yr (expected 3.8%; prior -1.1%) and imports 1.9% yr/yr (expected 2.8%; prior 1.0%); November Economy Watchers Index 48.7 (expected 49.5; prior 49.1)
  • Japan's Q3 GDP -0.6% qtr/qtr (expected -0.4%; last 0.5%) and -2.3% annualized (expected -1.8%; prior 2.1%); Q3 GDP Price Index 3.4% yr/yr (expected 2.8%; prior 3.3%); November Bank Lending 4.2% yr/yr (expected 4.0%; prior 4.1%)

---Equity Markets---

• Japan's Nikkei: +0.1%
• Hong Kong's Hang Seng: -1.2%
• China's Shanghai Composite: +0.5%
• India's Sensex: -0.7%
• South Korea's Kospi: +1.3%
• Australia's All Ordinaries: -0.1%

Major European indices have started the week with little conviction on the part of buyers and sellers. Global markets are waiting on key central bank decisions this week (RBA, FOMC, SNB) and next week (BOE, ECB, and BOJ). News flow has been relatively light, although Elon Musk has made some waves, saying the EU should be abolished after the European Commission hit X with a $140 million fine. ECB member Schnabel suggested the ECB's next move is likely to be a rate hike but conceded that rates were unlikely to change soon. French President Macron, unhappy about a trade imbalance, raised the possibility of tariffs against China.

• In economic data:
  • Eurozone's December Sentix Investor Confidence -6.2 (expected -6.2; prior -7.4)
  • Germany's October Industrial Production 1.8% m/m (expected 0.2%; prior 1.1%)
  • Switzerland's November SECO Consumer Climate -34 (expected -34, prior -37)

---Equity Markets---

• STOXX Europe 600: -0.1%
• Germany's DAX: +0.2%
• U.K.'s FTSE 100: -0.2%
• France's CAC 40: -0.3%
• Italy's FTSE MIB: +0.1%
• Spain's IBEX 35: +0.1%

The S&P 500 futures currently trade ten points above fair value. 

President Trump said via Truth Social that he will sign an executive order pertaining to the federal regulation of AI this week, citing companies' need for expediency in the approvals process. 

Separately, Director of the National Economic Council Kevin Hassett told CNBC President Trump will make a "huge amount" of economic announcements this week.

Equity futures point to a modestly higher opening this morning after Friday's action saw the major averages close with slight gains, capping a week of modest gains. 

Stocks drifted higher for the bulk of last week after a relatively sharp slide last Monday that came as a result of a cryptocurrency sell-off. Action in recent sessions has been somewhat muted, with some back-and-forth posturing ahead of this week's FOMC decision. 

The market is largely expecting the Fed to deliver a "hawkish cut" on Wednesday, meaning expectations for further easing in January have remained low. The CME FedWatch tool currently assigns an 89.6% probability to a 25-basis-point rate cut on Wednesday, but just a 21.8% probability to an additional cut in January. 

On the trade front, the Supreme Court could rule as soon as this month on President Trump's tariff authority as companies file lawsuits to get refunds, according to The Washington Post. 

There are no economic data releases scheduled for today. 

In corporate news:

• Microsoft (MSFT 483.81, +0.65, +0.1%) is in talks to switch its custom chip business from Marvell Technology (MRVL 92.90, -6.01, -6.1%) chips to Broadcom (AVGO 399.92, +9.68, +2.5%) chips, according to The Information.
• NextEra Energy (NEE 85.35, +2.22, +2.7%) and Alphabet's (GOOG 321.57, -0.52, -0.2%) Google Cloud announce a landmark strategic energy and technology partnership to accelerate AI growth and transform the energy industry.
• President Trump tells reporters that the Netflix (NFLX 101.12, +0.88, +0.9%) deal for Warner Brothers (WBD 25.95, -0.13, -0.5%) could be an antitrust "problem. " President Trump said he will be personally involved in the approval process, according to Bloomberg.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region started the week on a mixed note with a relative lack of news catalysts. Japan's Nikkei: +0.1%, Hong Kong's Hang Seng: -1.2%, China's Shanghai Composite: +0.5%, India's Sensex: -0.7%, South Korea's Kospi: +1.3%, Australia's All Ordinaries: -0.1%.

In news:

• Attention turned mostly to the economic calendar, which featured better-than-expected export data for November out of China and a downward revision to Japan's Q3 GDP to -0.6% qtr/qtr from the preliminary estimate of -0.4%.
• Market participants are also waiting on this week's central bank meetings, starting with the RBA meeting tomorrow (expected to leave cash rate unchanged) and highlighted by the FOMC decision (25-basis-point cut expected) on Wednesday.

In economic data:

• China's November FX Reserves 3.346 trln yuan (expected 3.360 trln; prior 3.343 trln); November exports 5.9% yr/yr (expected 3.8%; prior -1.1%) and imports 1.9% yr/yr (expected 2.8%; prior 1.0%); November Economy Watchers Index 48.7 (expected 49.5; prior 49.1)
• Japan's Q3 GDP -0.6% qtr/qtr (expected -0.4%; last 0.5%) and -2.3% annualized (expected -1.8%; prior 2.1%); Q3 GDP Price Index 3.4% yr/yr (expected 2.8%; prior 3.3%); November Bank Lending 4.2% yr/yr (expected 4.0%; prior 4.1%)

Major European indices have started the week with little conviction on the part of buyers and sellers. STOXX Europe 600: flat, Germany's DAX: +0.1%, U.K.'s FTSE 100: flat, France's CAC 40: -0.2%, Italy's FTSE MIB: flat, Spain's IBEX 35: flat.

In news:

• Global markets are waiting on key central bank decisions this week (RBA, FOMC, SNB) and next week (BOE, ECB, and BOJ).
• News flow has been relatively light, although Elon Musk has made some waves, saying the EU should be abolished after the European Commission hit X with a $140 million fine.
• ECB member Schnabel suggested the ECB's next move is likely to be a rate hike but conceded that rates were unlikely to change soon.
• French President Macron, unhappy about a trade imbalance, raised the possibility of tariffs against China.

In economic data:

• Eurozone's December Sentix Investor Confidence -6.2 (expected -6.2; prior -7.4)
• Germany's October Industrial Production 1.8% m/m (expected 0.2%; prior 1.1%)
• Switzerland's November SECO Consumer Climate -34 (expected -34, prior -37)

[BRIEFING.COM] The stock market had another somewhat subdued session today, with the S&P 500 (+0.2%), Nasdaq Composite (+0.3%), and DJIA (+0.2%) keeping with the recent trend of modest growth and adding to their week-to-date gains.

Stocks were little changed following the delayed release of the Personal Income/Outlays report for September, which showed in-line Personal Income growth (0.4%) while Personal Spending growth (0.3%; Briefing.com consensus 0.4%) was below expectations. September PCE Price growth (0.3%; Briefing.com consensus 0.3%) was in-line, and core PCE Price growth (0.2%; Briefing.com consensus 0.3%) was slightly cooler than expected, reducing the year-over-year growth rate to 2.8% from 2.9% in August, though this remains well above the Fed's 2.0% target.

While this was the last inflation reading before next week's FOMC decision, it had little effect on the major averages, largely because it had no effect on the market's rate-cut expectations. The CME FedWatch tool currently assigns an 87.2% probability to a December rate cut, down from 88.2% yesterday, and a 25.1% probability to an additional cut in January, down from 25.4% yesterday. 

In corporate news, the headline that Netflix (NFLX 100.24, -2.98, -2.89%) has entered into a definitive agreement to acquire Warner Bros. Discovery (WBD 26.06, +1.52, +6.19%) in a cash and stock transaction worth $72 billion was perhaps the most widely discussed happening today. Paramount Skydance (PSKY 13.36, -1.46, -9.82%) , which also submitted a bid for WBD traded sharply lower, with CNBC reporting that the company is considering taking a direct bid to WBD's shareholders. 

Alongside all of the acquisition buzz, Alphabet (GOOG 322.09, +3.70, +1.16%) and Meta Platforms (META 673.42, +11.89, +1.80%) quietly mounted some of the best performances across mega-cap names, which helped the communication services sector (+1.0%) finish as the top-performing S&P 500 sector. 

Despite some weakness in its own largest components, NVIDIA (NVDA 182.41, -0.97, -0.53%) and Apple (AAPL 278.78, -1.92, -0.68%), the information technology sector (+0.5%) also finished with a solid gain as a majority of its components traded higher. 

The consumer discretionary sector (+0.4%) rounded out the three S&P 500 sectors that finished higher, with Ulta Beauty (ULTA 601.50, +67.55, +12.65%) capturing the widest gain across S&P 500 names after a beat-and-raise Q3 earnings report. 

The financials and real estate sectors finished flat, while six sectors finished lower. Losses were relatively modest, with the exception of the utilities sector (-1.0%), which extended its week-to-date losses to 4.5%, the widest across S&P 500 sectors. 

The health care (-0.4%) and consumer staples (-0.3%) sectors were also among the laggards as defensive sectors faced some pressure this week. 

Overall, the major averages continued to drift modestly higher, with buyers showing little urgency ahead of next week's FOMC decision. With expectations for policy largely unchanged and catalysts scarce, stocks appear content to meander within recent ranges as the market waits for clearer signals from the Fed.

U.S. Treasuries retreated on Friday, sending the 30-year note yield to its highest level since early September, while yields on 5s and 10s settled just below their November highs. The 2-year note yield settled up three basis points to 3.56% (+7 basis points this week), and the 10-year note yield settled up three basis points to 4.14% (+12 basis points this week).

• Nasdaq Composite: +22.1% YTD
• S&P 500: +16.8% YTD
• Russell 2000: +13.1% YTD
• DJIA: +12.7% YTD
• S&P Mid Cap 400: +6.4% YTD

Reviewing today's data:

• September Personal Income 0.4% (Briefing.com consensus 0.4%); Prior 0.4%, September Personal Spending 0.3% (Briefing.com consensus 0.4%); Prior was revised to 0.5% from 0.6%, September PCE Prices 0.3% (Briefing.com consensus 0.3%); Prior 0.3%, September PCE Prices - Core 0.2% (Briefing.com consensus 0.3%); Prior 0.2%
  • The key takeaway from the report is that it revealed a very sticky inflation component that remains well above the Fed's 2.0% inflation target. That likely won't prevent the Fed from cutting rates next week, but it will likely factor into a "hawkish cut," as the Fed implies it will be inclined to wait longer for the next rate cut.
• October Factory Orders DELAYED (Briefing.com consensus -0.3%)
• December Univ. of Michigan Consumer Sentiment - Prelim 53.3 (Briefing.com consensus 52.0); Prior 51.0
  • The key takeaway from the report is its note that consumers' overall view can still be thought of as broadly somber, notwithstanding the month-over-month increase, due to the burden of high prices.
• Consumer credit increased by $9.2 billion in October (Briefing.com consensus: $9.8 billion) following a downwardly revised $11.0 billion increase (from $13.0 billion) in September.
  
  • The key takeaway from the report is that the expansion in consumer credit in October was paced by revolving credit, which could be construed as a sign of consumers leaning more on credit cards to fund spending needs due to disposable income being pinched by higher prices (and missing paychecks for some during the government shutdown).