T3’s Take 3: Twitter Skyrockets on M&A Chatter, Facebook Not so Much

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1) Twitter Blasts Into Orbit

This morning, CNBC reported that Twitter (TWTR) may be in talks to be taken over by Google (GOOGL) or Salesforce.com (CRM).

While Twitter has been the source of regular takeover rumors for over a year, traders certainly seemed to believe the new chatter.

Twitter shares rose an incredible 21.4% to $22.62 today, its best performance in over 2 years, while call options volume exploded.

In fact, Twitter call options set a volume record today, surpassing their last record set on December 26, 2013 – when Twitter’s stock price hit an all-time high of $74.73.

2) Markets Take a Break

US stocks took a breather today after 4 straight days of gains and a record high in the Nasdaq Composite yesterday.

The S&P 500 fell -0.6% to 2164.69 as traders locked in gains.

Large cap tech was weak, with Apple (AAPL) falling -1.7% to $112.71 after market research firm GFK said iPhone 7 sales could disappoint.

Crude oil dropped -3.2% to $44.85 after Saudi Arabia dismissed reports of an output freeze or cut at next week’s OPEC meeting in Algiers.

As a result, oil and energy services stocks led the decliners’ column.

Biotechnology, industrials, and financials were also weak.

3) Facebook Suffers a PR Blow

Shares of momentum favorite Facebook (FB) took a little dive today after apologizing for an error in its video measurement tools.

Facebook mistakenly overstated the average time its users spent watching videos for the past 2 years.

This news raises questions about the success of Facebook’s high-profile push into video, and is causing some frustration on the part of advertisers that make decisions based upon Facebook video metrics.

However, Facebook said that its miscalculations did not impact customer billings or the number of video views, which should soften the blow to some extent.

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Monday’s Trading Calendar

US Economics (Time Zone: EDT)

10:00 New Home Sales (Aug): exp. 600k, prior 654k
10:00 New Home Sales MoM (Aug): exp. -8.30%, prior 12.40%
10:30 Dallas Fed Manf. Activity (Sep): exp. -3, prior -6.2
11:45 Fed's Tarullo Speaks on Next Steps in Bank Stress Testing
13:30 Fed's Kaplan Speaks in San Antonio Moderated Q&A

Global Economics

04:00 EUR German Ifo Business Climate
05:30 CHF SNB Chairman Jordan Speaks
10:00 EUR ECB Pres. Draghi Speaks
19:10 CAD BOC Gov. Poloz Speaks

Earnings

Before Open:

Cal-Maine Foods (CALM)
Carnival Corp (CCL)

After Close:

None of Significance