1. Government bond yields hit highest level since 2007
The yield on the 10-year U.S. Treasury note rose 11 basis points early Monday to 5.02%, the highest level since 2007. The increase fueled concerns about rising interest rates. Federal Reserve Chairman Jerome Powell said last week that as bond yields push up borrowing costs, the Fed may be able to hold off on another rate hike at its November meeting, although central bank policymakers remain open to another hike , if a resilient economy keeps inflation from falling. Stock futures fell early Monday as investors reacted to rising government bond yields. Futures tied to the Dow Jones Industrial Average and the S&P 500 were down 0.6 percent at 6:45 a.m. ET, while those on the tech-heavy Nasdaq were down 0.8 percent. Bloomberg, CNBC
2. Chevron to buy Hess in $53 billion deal
Chevron announced Monday it will buy rival oil company Hess in the latest bet on the future of the oil industry despite a global push for renewable energy. The $53 billion Hess deal will give Chevron greater access to shale production in Texas’ Permian Basin, where it is already a leader, as well as Hess’ core oil assets in Guyana, which should fuel Chevron’s growth over the next decade . The deal continued a wave of consolidation following Exxon Mobil’s $60 billion purchase of shale driller Pioneer Natural Resources earlier this month, as smaller companies take advantage of high oil prices and team up with energy giants. Chevron said Hess would increase its oil and gas production by 10 percent. CNN, New York Times
3. Big tech leaders prepare to report quarterly earnings
Earnings season continues this week with quarterly reports from many of the big tech companies that have fueled the S&P 500’s rally this year. The benchmark index has risen 11% this year, but without Alphabet (Google), Amazon, Apple, Meta (Facebook), Microsoft, Nvidia and Tesla, its increase would have been just 0.6%, The Wall Street Journal reports. Those seven companies accounted for 17% of the S&P 500’s earnings per share last year, and that figure could reach 24% by 2025, according to Goldman Sachs Group. “The growth rates that these companies are delivering are incredibly important to the perception of the health of the overall stock market,” Bryant VanCronkhite, senior portfolio manager at Allspring Global Investments, told the Journal. The Wall Street Journal
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4. Drug store closings leave some communities without pharmacies
The nation’s largest drugstore chains have closed hundreds of stores as they grapple with rising competition and the cost of opioid lawsuits, leaving many vulnerable communities without pharmacies, The Washington Post reported. “By our estimates, about one in four neighborhoods is a pharmacy desert across the country,” Dima Kato, an associate professor at the University of Southern California, told the Post. “These closings disproportionately affect the communities most in need of pharmacies.” Rite Aid filed for Chapter 11 bankruptcy protection last week. Rite Aid, CVS and Walgreens have indicated in the past two years that they plan to close more than 1,500 stores combined. “The economics of running these stores have just failed,” Neil Saunders, managing director of analytics firm GlobalData Retail, told the Post. The Washington Post
5. “Killers of the Flower Moon” can’t dethrone Taylor Swift
Martin Scorsese’s “Killers of the Flower Moon,” starring Leonardo DiCaprio, Lily Gladstone and Robert De Niro, had a strong opening weekend, but not strong enough to knock “Taylor Swift: Tour of the Ages” off the top of the domestic box office. Scorsese’s historical crime drama about the murders of members of the oil-rich Osage Nation in the early 1920s brought in $23 million, the director’s third-best opening behind “Shutter Island” and “The Departed.” Swift’s concert film reported $31 million in ticket sales in its second weekend, following a record opening weekend of $92.8 million, making it the first concert film to top $100 million. The Associated Press called the battle for No. 1 “a movie matchup about as unlikely as ‘Barbie’ and ‘Oppenheimer’.” Associated Press