Gold, Oil and GamblingMerger Monday Is Back. What This Says About Recession. – Barron’s

Merger Monday is back with a bang.

Despite economic uncertainty, high interest rates, recent bank turmoil and the risk of a recession, theres been a hive of M&A activity to start the week.

Gold prices are hovering near all-time highs given the recent flight to safety of investors amid banking turmoil and broader economic concerns. Newmont wants to capitalize, scooping up Newcrests low-cost, long-life gold assets.

But theres another carrot. Newmont wants its rivals copper assets, a metal proving important to the worlds energy transitionused in everything from electric-vehicles to solar panels and wind turbines.

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Another commoditythis time oilwas at the center of a separate major deal as pipeline operator Oneok said its buying its rival Magellan Midstream Partners for $18.8 billion. It marks a move into oil for the predominantly natural gas-focused Oneok and would create a pipeline giant.

But its not just commodities driving the dealmaking. NeoGames agreed to be bought by Australian gaming technology developer Aristocrat Leisure for $1.2 billion.

M&A activity and the value of deals typically decline in an economic downturn. While Mondays dealmaking might point to optimism, thats not always the case. Sometimes companies do one last cut-price big deal to consolidate because they think the economy is going to fall.

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However, the values paid by Newmont and Oneok are hefty premiums which are a positive sign.

Callum Keown

*** Join Barrons senior managing editor Lauren R. Rublin and deputy editor Ben Levisohn today at noon when they discuss the outlook for financial markets, industry sectors, and individual stocks. Sign up here.

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Try your hand at this mornings Barrons digital jigsaw, which is based on the weeks cover story. For all games, including the daily crossword and sudoku, click here.

Lawmakers head into this week facing another crunchtime on an agreement about the nations debt ceiling. Democrats appearing on the Sunday talk show circuit threw cold water on some ideas at President Joe Bidens disposal, including invoking the 14th Amendment to continue raising debt.

Whats Next: Biden is expected to leave Wednesday for the G-7 world leader meeting in Japan despite earlier last week saying he would consider postponing the trip amid the debt ceiling standoff, White House press secretary Karine Jean-Pierre told reporters.

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Liz Moyer

After one of the biggest challenges to President Recep Tayyip Erdogan in his two decades at the center of power in Turkey, the country appears set for a runoff election. A first round of polling failed to yield an obvious winner, and both Erdogan and opposition leader Kemal Kilicdaroglu have said they are prepared to accept a runoff.

Whats Next: A confirmed runoff election would plunge Turkey into two weeks of renewed campaigning frenzy as Erdogan and Kilicdaroglu vie for a majority. Investors should brace for more volatility in the lira, a commonly traded global currency that has already declined almost 5% against the dollar in 2023.

Jack Denton

Electric vehicle start-ups have been forecasting disappointing manufacturing targets for 2023, citing problems that have nothing to do with demand. Polestar has blamed software, while Fisker said it took longer than expected to get final certifications required to sell any car. Rivian has had trouble accelerating production and securing semiconductors.

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Whats Next: Teslas shareholder meeting is Tuesday. Investors will vote on a shareholder proposal that seeks to identify key persons and succession processes. Tesla is telling shareholders to vote no, saying it could cause unnecessary competitive harm.

Al Root, Jack Denton, and Liz Moyer

Consumer prices, for everything from luxury handbags to streaming media subscriptions and fast food, continue to rise as companies demonstrate their brand power, helping them cover the rising costs of labor and raw materials. A wave of retailer earnings this week could show how broad-based the trend is.

Whats Next: The Census Bureau reports retail sales data for April on Tuesday. Consumer spending is expected to increase 0.7% month over month, while sales excluding autos are seen rising 0.4%. March had monthly declines of 0.6% and 0.4%, respectively.

Liz Moyer and Barrons staff

The Hollywood writers strike is forcing changes to the television industrys annual advertising sales blitz. Netflix has moved what was a planned in person presentation at its Paris Theater in New York to a virtual presentation out of concern for picketing writers, The Wall Street Journal reported.

Whats Next: Insider Intelligence expects upfront ad spending will fall by 3.4% to $18.6 billion for the 2023-2024 season, the Journal reported. The research firm cited uncertainty in the economy, falling TV ratings and cord-cutting as part of the reason for the decline.

Liz Moyer

I rent a condo for $1,500 in Southern California and work as a server at a steak house earning $55,000 to $60,000 a year. Im 54 and single and have saved $100,000, and have no debt. Should buy something in California, or just save it for a rainy day?

A MarketWatch correspondent will answer this question soon. Meanwhile, send any questions you would like answered to thebarronsdaily@barrons.com.

Newsletter edited by Liz Moyer, Brian Swint, Rupert Steiner and Steve Goldstein

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Gold, Oil and GamblingMerger Monday Is Back. What This Says About Recession. - Barron's