Wall Street’s main stock indexes kicked the first trading day of the year in red territory as the number of coronavirus infections spiraled and Covid-19 vaccine rollouts started.
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The tech-heavy Nasdaq Composite Index and the S&P 500 Index both dropped 1.6%. The Dow Jones Industrial Average declined 1.5%.
Shares of Tesla climbed 3.5% after the electric vehicle maker announced that it delivered 499,550 EVs in 2020, up from 367,500 units it had shipped in 2019. Deliveries for 2020 surpassed analysts’ expectations of 481,261 units but fell fractionally short of CEO Elon Musk’s 500,000 target. During the year, Tesla shipped 442,511 Model 3 and Model Y vehicles while it delivered 57,039 units of Model S and X. The company said, “Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5% or more.”
Investors also piled into the stock of China-based Xpeng. Shares increased 4.2% as the EV maker’s deliveries exploded 326% year-over-year to 5,700 vehicles in December 2020 and were up 35% month-over-month. Including the December deliveries, the company’s 4Q deliveries grew 303% year-over-year to 12,964 smart EVs and 2020 total deliveries grew 112% to 27,041. The company’s 4Q deliveries were notably ahead of its guidance of about 10,000 vehicles. The company’s December and 4Q growth rates were driven by growing brand awareness as well as enhanced sales, marketing and supercharging service initiatives across China.
Meanwhile, activist investor Carl C. Icahn has sold $600 million of Herbalife Nutrition’s common stock back to the company. Herbalife repurchased the shares at a price of $48.05 per share. The transaction is expected to close by January 7. Following the deal, Icahn will hold about 8 million Herbalife common shares, or about 6% of the outstanding shares. The share buyback is a part of the nutrition company’s 2018 repurchase program, which takes the total to about $1.5 billion in shares. HLF shares advanced 1.9% to trade at $48.95. Icahn said that “the time for activism has passed as the company has grown, and I don’t typically invest billions of dollars in companies where our role as activist is not needed. That being said, Herbalife’s products and business opportunity are needed now more than ever, and I look forward to remaining a shareholder of the company.”
In M&A news, Magellan Health popped 13% after Centene Corp. proposed to buy the healthcare company in an all-cash deal valued at $2.2 billion, in a move to create a leading behavioral health platform. The provider of government-sponsored and commercial health care programs has offered to pay $95 per share in cash, representing a 14.7% premium to Magellan’s close on Dec. 30. Centene said it will primarily fund the cash portion of the acquisition through debt financing, as J.P. Morgan has provided $2.381 billion in bridge financing. Centene shares rose almost 1%.
In other health-related news, EyePoint Pharmaceuticals spiked more than 20% after the China-based peer Ocumension Therapeutics made an equity investment worth $15.7 million in the ophthalmic pharmaceutical company. Ocumension purchased 3.01 million shares of EyePoint’s common stock at a five-day trailing volume-weighted average price of $5.22 per share as of the close of trading on Dec. 29, 2020.
Shares of Roku declined almost 4% amid a report that the video streaming platform is in advanced talks to snap up Quibi’s content catalog. The Wall Street Journal did not disclose the potential acquisition price. Quibi is a short-form streaming service, which was launched in April 2020 to develop high-end content for mobile phones. However, then in October, the company had reportedly been planning to shut down the operations and sell its assets, as the service never took off the way it desired. According to the WSJ, Roku is aggressively investing into content, and therefore, the Quibi acquisition would provide its own ad-supported app, the Roku Channel, exclusive access to Quibi’s library of shows and programs.
In coronavirus updates, Tiziana Life Sciences popped more than 18% after the biotech company announced the completion of the Brazil clinical trial of its nasally administered foralumab for the treatment of COVID-19. Preliminary findings of the trial showed that the response from patients treated with foralumab was positive and well-tolerated. Topline data from the trial results are expected to be released later this month. Foralumab is Tiziana Life’s exclusive fully human anti-CD3 monoclonal antibody. The proprietary nasal formulation and nasal delivery of foralumab promises an immediate relief to COVID-19 patients.
