US equity markets weaker as investors digested the latest round of corporate earnings and key economic data – Dow down -296-points or -1.19%, paring an earlier -539-point tumble. The broader S&P500 lost -1.73%, briefly entering official correction territory as the index traded more than 10% below its record high reached in September. Seven of the eleven primary sectors are down at least 10% from their 52-week highs, including energy, materials and financials. The NASDAQ fell -2.06%, with the technology-centric index down over 3% and its worst levels of last Friday's (26 October) session. Amazon.com Inc fell -7.8% and Google parent Alphabet Inc closed -1.8% lower (after dropping as much as -5.6% earlier in the session) as investors continued to ponder results from both technology giants after the market close last Thursday (25 October). Trade worries were also simmering after U.S. officials reportedly said talks with China won’t resume until Beijing comes up with solid proposals over forced technology transfers and other economic issues. For the week, the Dow and S&P500 dropped -3.9%, while the Nasdaq fell -3.8%. For October, the Dow is down -6.7% (and on pace for its biggest monthly decline since May 2010) and S&P 500 -8.8% (and eyeing its worst monthly performance since February 2009). The NASDAQ, meanwhile, has lost 10.9% and is on track to log its worst monthly decline since October 2008.
In other company news, International Business Machines Corp (IBM) said Sunday it plans to be the world’s largest hybrid cloud provider by acquiring open-source software company Red Hat Inc for US$190 per share in cash (63% above last Friday’s (26 October) closing price of US$116.68) in a deal with an enterprise value of ~US$34B.
