Stocks fell to start the holiday-shortened week as Nvidia (NASDAQ: NVDA) shares came under pressure ahead of the chipmaker's quarterly earnings report. The Dow Jones Industrial Average fell nearly 65 points, while the S&P 500 Index and Nasdaq Composite Index lost 0.6% and 0.9%,respectively.
Here's how the market settled on Tuesday:
S&P 500 Index (NYSE: SPY): -0.60% or -30.06 points to 4,975.51
Dow Jones Industrial Average (NYSE: DIA): -0.17% or -64.19 points to 38,563.80
Nasdaq Composite Index (NASDAQ: QQQ): -0.92% or -144.87 points to 15,630.78
In the News: Capital One Financial (NYSE: COF) announced it will acquire Discover Financial Services (NYSE: DFS) in an all stock deal valued at $35.3 billion on Monday, with the merger set to expand Capital One's credit card offers and deposit base.
Under the agreement, Discover shareholders would receive 1.0192 shares of Capital One for each Discover share, respersing a roughly 25% premium from Discover's Friday closing price . The company's expect the deal to close by early 2025, with Capital One shareholders holding 60% and Discover shareholders owning 40% of the new company after completion.
However, Raymond James analyst Ed Mills said Monday that the merger could face heightened security from U.S. lawmakers, as well as from upcoming updates from the office of the Comptroller of the Currency and the Department of Justice regarding merger guidance for financial institutions.
"This deal is much larger than any of our DC contacts have been telling us is possible for regulatory approval in the current DC climate, especially after the bank panic of last March. The press release provides a deal close of 4Q24 or early 2025 - this appears to be an aggressive timeline," said Mills in a note on Tuesday.
On the Earnings Front: Walmart (NYSE: WMT) reported strong fourth-quarter earnings on Tuesday and announced it would acquire smart TV maker Vizio (NYSE: VZIO) in a $2.23 billion all-cash deal to help boost its ad business. For its fiscal 2025, the big box retailer expects consolidated net sales to increase by 3% to 4%, alongside adjusted earnings in the range of $6.70 to %7.12 per shares on a pre-stock split basis.
"We believe VIZIO's customer-centric operation system provides great viewing experiences at attractive price points. We also believe in enables a profitable advertising business that is rapidly scaling," said Seth Dallaire, executive VP and chief revenue officer at Walmart U.S., in a statement.
Home Depot (NYSE: HD) issued better-than-expected fourth-quarter earnings on Tuesday despite waning consumer demand as the company's "market is on its way back to normal demand conditions," according to CFO Richard McPhail, quoted by CNBC.
"We're not quite there yet, but the pressures we saw in 2023 are receding," McPhail told the news outlet.
For Wednesday: Market participants will react to the minutes from the Federal Reserve's latest policy meeting for more clues on central banker's next moves regarding interest rates, alongside earnings reports from companies including Palo Alto Networks (NASDAQ: PANW), Diamondback Energy (NASDAQ: FANG) and Analog Devices (NASDAQ: ADI).