January 3, 2018

Stocks race to new highs; MoneyGram takeover blocked; Fed minutes

1. Starting on a high: Wall Street celebrated the new year on Tuesday by pushing stock indexes to new all-time highs.

U.S. stock futures continue to strengthen, indicating the S&P 500 and Nasdaq could hit new records today. The Dow Jones industrial average continues inching closer towards 25,000 points.

European markets are also mostly positive in early trading, and Asian markets ended the day with gains.

Twitter is exploding with concern about President Trump's tweet taunting North Korea about his "bigger & more powerful" nuclear button, but investors appear to be paying little attention.

2. Pharmacies report earnings: Rite Aid is set to report earnings after trading closes on Wednesday, and Walgreens Boots Alliance reports on Thursday.

This is an important time for the pharmacy sector as CVS pursues an acquisition of Aetna. The deal could transform drug stores into health clinics and lower prices for consumers.

Pharmacies may also have to contend with competition from Amazon. Rumors of the company's entry into the prescription drug distribution business have been swirling.

3. Fed minutes: The Federal Reserve's monetary policy committee is releasing the minutes of its December meeting.

Investors will parse the text to get a sense of whether to expect extra interest rate hikes in 2018.

"It will be interesting to see the [Fed's] views on the fiscal impacts of Trump's tax reform and how this affected the prospects for interest rate hikes in the future," said Daniel Bergvall, an economist at the Swedish bank SEB.

4. Let's call the whole thing off: MoneyGram is calling off its merger with a Chinese financial services giant after failing to get approval from the U.S. government.

"The geopolitical environment has changed considerably since we first announced the proposed transaction with Ant Financial nearly a year ago," MoneyGram CEO Alex Holmes said in a statement Tuesday.

The deal between Ant Financial, an affiliate of Jack Ma's tech company Alibaba, and the American money transfer service was first announced in January 2017. Ant Financial originally agreed to pay $880 million, but upped its offer to $1.2 billion in April.

The agreement had been under review by the Committee on Foreign Investment in the United States, which vets deals that could give a foreign investor control of a U.S. business.

5. Coming this week: Wednesday -- Rite Aid earnings, Automakers report December sales numbers Thursday -- Walgreens and Monsanto earnings Friday -- U.S. December jobs report

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