Stocks Waver, Oil Drops as Investors Monitor News on Middle East Conflict; Tesla Soars on Robotaxi Launch

Supermicro Slides on News of Convertible Bond Offering

1 hr 14 min ago

Super Micro Computer (SMCI) shares tumbled Monday after the AI server maker said it plans to issue $2 billion in convertible bonds.

Supermicro shares were down more than 7% in recent trading, leading S&P 500 decliners. Still, they’ve added over 35% since the start of the year.

The San Jose, Calif.-based server maker said the bonds will mature on June 15, 2030. Supermicro said it would use the proceeds partly for general corporate purposes. Up to $200 million of the proceeds will go towards financing capped  call transactions, which firms use to reduce the potential dilution from the issue of convertible bonds. The transaction usually involves the company buying call options on its own stock, which are subject to a cap.

Supermicro also said it expects to give the initial buyers of the convertible bonds the option to acquire an additional $300 million of the notes within 13 days from when it issues the bonds. 

Supermicro shares have had a volatile 12 months amid concerns about its accounting  practices and investor fears it would be delisted from the Nasdaq. The company met the exchange’s deadline to file its delayed reports in February, sending shares soaring at the time, but cut its sales outlook for fiscal 2025 in May, weighing on the stock. 

–Nisha Gopalan

Novo Nordisk Falls as Weight Loss Drug Trial Disappoints

1 hr 47 min ago

Novo Nordisk (NVO) shares slid Monday after the drugmaker revealed the results of a Phase 3 trial for a new weight-loss treatment.

The maker of Ozempic and Wegovy said that after a 68-week trial, obese and overweight patients who took CagriSema and followed a treatment plan lost an average of 22.7% of their body weight compared to 2.3% for those in the placebo group.

About 40% of the group lost at least 25% of their body weight during the trial, and nearly a quarter lost 30% or more. Just 6% of the trial group stopped taking the drug, mainly due to gastrointestinal issues like nausea and constipation.

Novo Nordisk also published results from a second trial Monday, evaluating the drug’s effectiveness among overweight or obese patients with type 2 diabetes. At 68 weeks, the average weight loss was about 15.7% of a patient’s body weight, and the company said the second trial had similar safety results as the first.

Previous trial results for the drug weighed on Novo Nordisk’s shares, as CagriSema has yet to achieve the average weight loss of 25% that the company has reportedly hoped for. Shares have also been pressured by trials showing that rival Eli Lilly’s (LLY) Mounjaro and Zepbound, along with its drugs in development, are more effective at causing weight loss than Ozempic and Wegovy.

U.S.-listed shares of Novo Nordisk were down 6% in early-afternoon trading Monday, while Ely Lilly gained less than 1%.

–Aaron McDade

Northern Trust Surges on Reported Merge Talks With BNY

2 hr 45 min ago

Northern Trust (NTRS) shares surged Monday morning after Bank of New York Mellon (BK) reportedly approached the smaller bank about a merger last week.

CEOs at the two banks had at least one conversation, though haven’t discussed a specific offer, according to The Wall Street Journal, citing people familiar with the matter. “BNY is considering its next steps, which might include returning to Northern Trust with a formal bid,” the report said. 

The report said that Northern Trust isn’t interested in a merger with BNY and noted a tie-up “would marry two of the world’s largest asset-servicing businesses and create an investment-management powerhouse that oversees more than $3 trillion.”

Northern Trust and BNY didn’t immediately respond to Investopedia requests for comment. 

Citi analysts said they would see a deal as a “win-win,” with the two franchises seeming “complementary” and raised their price targets for Northern Trust stock to $110 per share from $100, and $92 for BNY from $85, “reflecting possibility of acquisition.” They noted, however, that “this deal does not seem like a “must have,” and that they “expect BK to be disciplined on pricing and would expect only ~10% premium deal given NTRS’ relatively high valuation.”

Northern Trust shares were up 8% at around $121 in recent trading, boosting the stock’s year-to-date gain to 18%. BNY shares, which entered Monday up about 19% this year, were down 3% Monday morning at around $89.

–Nisha Gopalan

Tesla Jumps After Robotaxi Service Launch

3 hr 22 min ago

Tesla (TSLA) shares surged in early trading Monday, a day after the electric vehicle maker launched its robotaxi service in Austin, Texas.

The small-scale launch Sunday featured invites sent to Tesla retail investors and several people with social media accounts dedicated to the brand, Bloomberg  reported.

Tesla shares, which entered Monday trading down 20% since the start of the year, were up 9% recently at their highest level in a month.

Several users who took some of the first rides on Sunday posted about their experiences on X, the social media platform also owned by Tesla CEO Elon Musk, who wrote that each ride cost a flat fee of $4.20.

User videos indicated no one sat in the driver’s seat, a Tesla employee was in the passenger seat to monitor the experience, and passengers sat in the back.

–Aaron McDade

Bitcoin Levels to Monitor Amid Cryptocurrency Volatility

4 hr 24 min ago

Bitcoin (BTCUSD) briefly fell below $99,000 on Sunday as news that the U.S. had struck Iranian nuclear sites caused investors to reassess their appetite for risky assets.

The digital currency moved as low as $98,200 on Sunday afternoon, its lowest level since May 8, amid uncertainty about the geopolitical and economic outlook after the U.S. late Saturday entered a conflict between Israel that had intensified over the past week. In recent trading, bitcoin had rebounded to about $101,500 but was still well down from its high last Monday of near $109,000.

After trending sharply higher between early April and late May, bitcoin has consolidated within a descending channel.

Over the past week, the cryptocurrency’s price has retraced toward the pattern’s lower trendline, an area on the chart that closely aligns with the psychological $100,000 level. Moreover, recent selling has coincided with the relative strength index falling below its neutral threshold, signaling weakening price momentum.

Investors should watch crucial support levels on Bitcoin’s chart around $100,000 and $92,000, while also monitoring resistance levels near $107,000 and $112,000.

Read the full technical analysis piece here.

–Timothy Smith

Major Index Futures Little Changed

5 hr 25 min ago

Futures tied to the Dow Jones Industrial Average were down 0.1% in recent trading.

S&P 500 futures were fractionally lower.

Nasdaq 100 futures also fell less than 0.1%.