US pre-open: Futures higher following Nvidia deal

Wall Street futures had stocks opening higher ahead of the bell on Monday as sentiment got a slight boost from news that chipmaker Nvidia had agreed to buy competitor Arm Holdings.

As of 1230 BST, Dow Jones futures were up 0.93%, while S&P 500 and Nasdaq-100 futures had the indices opening 1.23% and 1.59% firmer, respectively.

The Dow Jones closed 131.06 points firmer on Friday in a mixed session that saw another tech sell-off weigh on the Nasdaq and lead to the market's first back-to-back weekly declines for several months.

Nvidia will purchase Arm Holdings from Japan's Softbank for $40.0bn and will finance the deal through a combination of cash and common stock.

Also in deal news, TikTok parent ByteDance rejected Microsoft's bid to buy it US operations, opting instead to make Oracle its US partner, providing it with a significant stake in the business.

In terms of ongoing stimulus negotiations on Capitol Hill, senate majority leader Mitch McConnell said late last week that the chances of both sides reaching an agreement didn't "look that good right now".

As far as the coronavirus pandemic was concerned, the number of cases in 11 US states were growing by 5% or more, according to John Hopkins University, while news that AstraZeneca's vaccine trial had resumed provided stocks with a lift.

IG's Joshua Mahony said: "Global markets are kicking off the week on an optimistic footing, with M&A activity and vaccine developments helping to lift spirits after recent declines. Weekend news that Oracle looks set to purchase TikTok’s American operations does help ease friction between the US and China, yet there will be questions over just how much data remains available to the main entity.

"On the vaccine front, news that the AstraZeneca vaccine trial is to resume provides a significant boost after fears that complications with one participant could represent a significant hurdle to development. With Trump telling states to expect a vaccine before the election, there is a feeling that we are in the home straight in the push for an effective treatment."

On the macro front, the only data point for the day will be consumer inflation expectations for August at 1600 BST.

In corporate news, Miami-based homebuilder Lennar will report earnings after the close of trading.