Wall Street Breakfast Podcast: How Harris’ Race Impacts the Market

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Wall Street futures rise as Biden backs down; China cuts rates. (00:24) Goodyear to sell off-road tire business to Yokohama for $905 million. (01:51) Woodside Energy to buy LNG developer Driftwood Tellurian for $1.2 billion. (02:07)

This is an abridged transcript of the podcast.

Stock index futures gained some ground in early trading Monday after President Joe Biden withdrew from the presidential race.

S&P 500 futures (SPX) +0.4%, Nasdaq 100 futures (US100:IND) +0.5% and Dow futures (INDU) +0.1%.

The broader market is coming off its worst week since April.

Rates edged lower after a surprise rate cut in China. The yield on the 10-year Treasury note (US10Y) fell one basis point to 4.23%.

The People’s Bank of China cut its 7-day reverse repo rate from 1.8% to 1.7%, its 1-year prime lending rate from 3.45% to 3.35% and its 5-year rate from 3.95% to 3.85%.

The dollar (DXY) was slightly lower against the euro (USD:EUR) and the yen (USD:JPY).

You heard here Sunday at the Wall Street Brunch with Kim Khan that Biden withdrew from the race Sunday afternoon and endorsed Vice President Kamala Harris for the Democratic nomination.

She has yet to receive the endorsement of former President Obama, but she has received support from other leading Democrats.

Bitcoin (BTC-USD), which trades 24 hours a day, fell before Biden’s decision became official and dropped nearly 2% after the announcement. But it has since recovered and is up 0.4% at $67,000.

TS Lombard believes that this U-turn between Biden and Harris should not have much impact on the markets for now.

Goodyear Tire & Rubber Company (NASDAQ: GT) today announced that it will sell its off-the-road (OTR) tire business to Japan-based Yokohama Rubber Company (OTCPK: YORUY) for $905 million in cash.

This is part of the company’s strategic transformation plan.

The OTR Tires business supplies OTR tires worldwide to the surface and underground mining, construction and quarrying, and ports and industrial end markets.

Goodyear said it will retain its OTR tire supply business for U.S. military and defense applications, following a product supply agreement with Yokohama. Goodyear will manufacture certain OTR tires for Yokohama for up to five years.

The sale is expected to be finalized in early 2025.

Goodyear intends to use the proceeds from the transaction to reduce debt and fund initiatives related to the Goodyear Forward transformation plan.

In other M&A news…

Woodside Energy (WDS) announced Sunday evening that it has agreed to acquire liquefied natural gas developer Tellurian (NYSE: TELL) for $1.2 billion in cash, including debt.

Woodside (WDS) said its acquisition of Tellurian (TELL), the developer of the 27.6 million metric tons per year Driftwood LNG export project in Lake Charles, Louisiana, positions it as “a global LNG powerhouse.”

Woodside (WDS) will provide Tellurian (TELL) with a loan of up to $230 million to ensure operations at the Driftwood LNG site maintain momentum ahead of the deal closing.

More articles on Seeking Alpha:

Kamala Harris’ Potential Impact on Healthcare Stocks

Fast-food restaurants face disgruntled consumers and nervous investors

SA asks: Which chip companies could withstand an attack on Taiwan?

Catalyst Watch:

• The Farnborough International Airshow will attract the attention of the aviation industry. The most anticipated presences are Boeing (BA), Embraer (ERJ), Airbus (OTCPK:EADSF) and Textron (TXT). The eVTOL (Electric Vertical Takeoff and Landing) industry will also be in the spotlight, with the presentation of Vertical Aerospace (EVTL), Joby Aviation (JOBY), Supernal and Lilium (LILM).

Now let’s take a look at the markets at 6 a.m. Ahead of today’s open, Dow, S&P and Nasdaq futures are in the green. Crude oil is down 0.1% at $78 a barrel. Bitcoin is up 0.4% at $67,000.

On global markets, the FTSE 100 is up 0.7% and the DAX is up 1.2%.

Top Stocks in Premarket: Serve Robotics (NASDAQ:SERV) is up 44% after rallying 187% on Friday, driven by news that Nvidia (NVDA) has acquired a stake in the company.

Today’s economic agenda:

Editor’s Note: This article discusses one or more securities that are not traded on a major U.S. exchange. Be aware of the risks associated with these securities.