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Market Update

Marriott Deal and Resilient European Markets Overshadow Nikkei Weakness

Author: Nichole Harper
Last Update: 11:23 AM ET November 16 2015

[11:30 AM New York City, New York – Stocks on Wall Street lacked direction and European markets retained positive bias but indexes in Asia struggled after Japan fell back into recession again. Marriott International agreed to acquire rival Starwood in $12 billion to become the largest hotelier in the world.

Stocks on Wall Street lacked direction on Merger Monday and European markets retained positive tone despite the deadly terrorist attacks in France over the weekend.

On Wall Street, Tollbooth Strategy Index increased 44.18 or 0.4% to 10,663.62.

S&P 500 index edged up 5.81 to 2,028.85 and the Nasdaq Composite Index slid 0.73 to 4,927.15.

Crude oil in New York fell 41 cents to $40.33 a barrel and gold added $1.56 to $1,085.47 an ounce.

U.S. Movers

Berkshire Hathaway Inc ((BRK.A)) rose $593.95 to $198,418.95 and said in a regulatory filing that it cut shares in Goldman Sachs Group Inc as of September 30 to 11 million, 13% lower from the 12.6 million shares at the end of June quarter

Marriott International Inc (MAR) slipped 2.2% or $1.62 to $71.12 after the hotels and resorts operator agreed to acquire Starwood Hotels & Resorts Worldwide Inc for $12.2 billion and create the world''s largest hotel chain.

Under the terms, shareholders of Starwood receive 0.92 shares of Marriott International and $2 in cash per share.

The transaction is expected to close in mid-2016.

Media General Inc (MEG) gained 11 cents to $15.56 after the news, information and entertainment provider rejected a buyout offer worth about nearly $1.9 billion from Nexstar Broadcasting Group Inc.

Media General said the current offer significantly “undervalues the company.”

However, the company plans to negotiate with Nexstar after obtaining permission from Meredith Corp to exchange information.

Media General is currently in a merger discussion with Meredith Corp.

European Markets

Stock markets in Europe opened lower on Monday in the aftermath of the tragic events in Paris that killed more than 130 people. By midday, however, investors regained confidence and the major bourses recovered.

In a preliminary estimate, the annual inflation rate in the euro zone rose to 0.1% from the decrease of 0.1% in September.

In the wider region of EU28, annual inflation rate was zero in October from the decrease of 0.1% in September.

In the same month a year ago, the inflation increased 0.5%, the Statistical Office of the European Communities said.

In London trading, FTSE 100 index gained 20.04 or 0.3% to 6,138.88 and in Frankfurt the DAX index rose 14.43, or 0.13%, to 10,722.23.

In Paris, CAC 40 index slid 6.66, or 0.14%, to 4,800.50.

Travel, leisure, and luxury stocks led the decline after multiple terrorist attacks in Paris, France.

Tourism sector stocks fell after investors worried that the tightened travel regulations and lower consumer confidence will drag down tourist arrivals.

Accor SA, the France-based luxury hotels operator, plunged 4.9% to €39.47, while Air France-KLM SA fell 6.92% to €6.32.

In the UK, Diploma Plc surged 17.2% to 712.78 pence after the technical products and services provider said revenues in the year ending in September jumped 9% to £333.8 million, as compared to the previous year.

Profit in the year increased 4% from a year ago to £37.4 million and diluted earnings per share rose to 32.5 pence from 31.4 pence.

Asian Markets

Nikkei index fell sharply over 300 points at the opening in early trading and in volatile trading trimmed losses but the average closed down 1% after the weaker-than-expected GDP report.

Stocks and the yen in Tokyo declined on the rising worries that the export-driven Japanese economy may slow down as the euro zone struggles with the extended period of marginal growth.

The Japan’s economy fell in to technical recession after the gross domestic product contracted in the three months to September, second quarterly decline in a row.

However, the government maintained an upbeat outlook and said the economy continues to recover moderately in the current quarter.

The preliminary figures of gross domestic product in the third-quarter declined 0.8% compared to the revised 0.7% fall in the second-quarter, the Cabinet Office said.

On a seasonally adjusted basis, GDP in the quarter decreased 0.2% from last-quarter.

The retailers J. Front and Takashimaya reported sales in October jumped. Toshiba’s U.S. unit reported impairment charges of about $1.3 billion.

The Nikkei 225 Stock Average dropped 203.22 or 1% to 19,393.69 and the broader Topix index slumped 14.30 to 1,571.53.

The yen weakened to 122.40 against a dollar.

J. Front Retailing Co Ltd declined 3.2% to 1,935 yen after the consumer goods retailer said total sales in October jumped 4.4% but sales in wholesale business plunged 6.2% while sales in credit and other business segment soared 9.2% and 8.7% respectively.

Market indexes in Mumbai opened higher and stayed above the positive line and the latest read on wholesale price showed another monthly decline.

The wholesale price index in October declined 3.81% compared to the fall of 4.54% in previous month and increase of 1.66% in the year-ago period, the Ministry of Commerce and Industry reported.

Rupee strengthened 9 paisa to 66.01 against one U.S. dollar.

The Sensex Index advanced 149.57 or 0.6% to close at 25,760.10. The CNX Nifty increased 44.35 or 0.6% to 7,806.60.

Apollo Tyres plans to acquire Germany-based automotive products retailer.

Coal India, the central government controlled and the largest coal miner in India said quarterly profit rose 16%.

Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc