Big changes are coming to the Dow Jones Industrial Average due to Apple’s (NASDAQ:AAPL) 4-for-1 stock split, which will significantly reduce the benchmark’s exposure to the information technology sector. Exxon Mobil (NYSE:XOM), Pfizer (NYSE:PFE) and Raytheon (NYSE:RTX) will be swapped out for Salesforce.com (NYSE:CRM), Amgen (NASDAQ:AMGN) and Honeywell (NYSE:HON), marking the biggest reshuffle in seven years. The moves are effective before the open on Monday, while the divisor used to calculate the blue-chip index from the constituents will be changed before then, preventing any distortions.
The Fed’s annual economic policy symposium, known as Jackson Hole, goes online this year for the first time since it began in 1978. The highlight was a speech from Fed Chair Jerome Powell, which will have a transformative effect on U.S. monetary policy for the foreseeable future. The central bank shifted sharply from its yearslong strategy, saying it would keep interest rates low to help prop up the pandemic ravaged economy even if inflation rises above its target level of 2% for periods of time.
Cloud and software stocks got a boost following a stellar earnings report from Salesforce (NYSE:CRM) on Tuesday. The company raised its full-year outlook to $20.7B-$20.8B in revenue and adjusted EPS of $3.72-3.74 (after lowering guidance last quarter). Shares climbed 13% AH on the Q2 results, which saw subscription and support sales up 29% and Professional Services increase 23%. “It’s humbling to have had one of the best quarters in Salesforce’s history against the backdrop of multiple crises seriously affecting our communities around the world,” said CEO Marc Benioff.
A surprising party joined the race for TikTok, as Walmart (NYSE:WMT) joined forces with Microsoft (NASDAQ:MSFT) to buy the U.S. assets of the popular short video app. The bid could total $30B or even more, and as odd as that coupling seems, CNBC reports that Walmart originally sought majority ownership of TikTok in a consortium with Alphabet (GOOG, GOOGL) and SoftBank (OTCPK:SFTBY). “We believe a potential relationship could provide Walmart with an important way for us to reach and serve omnichannel customers as well as grow our third-party marketplace and advertising businesses,” the company said in a statement. Oracle (NYSE:ORCL) is another U.S. company vying to acquire the assets of TikTok, whose CEO Kevin Mayer called it quits this week only three months into the job.
Data analytics firm Palantir (PLTR) filed to go public, confirming prior reports that the company would pursue a direct listing – the same unconventional route taken by Slack (NYSE:WORK) and Spotify (NYSE:SPOT). The secretive tech business co-founded by Peter Thiel is reportedly hoping for a valuation of about $26B, despite losing $588M, or $580M on a pro-forma basis, in 2019. Another Thiel-backed business, called Luminar, went public on Monday via a $3.4B SPAC merger, while workplace app Asana (also backed by Thiel) filed for direct listing on NYSE.
Go Deeper: Year of the SPAC.
In a move that would substantially expand the nation’s capacity for rapid testing, the Trump administration unveiled a $750M deal to buy 150M rapid COVID-19 tests from Abbott Laboratories (NYSE:ABT). “This is a major development that will help our country to remain open, get Americans back to work and kids back to school,” White House senior adviser Alyssa Farah declared. Abbott said the new antigen test (about the size of a credit card) has demonstrated sensitivity of about 97% and could returns results in 15 minutes.
Go Deeper: FDA allows emergency use of convalescent plasma.
Moving further into the grocery sector to challenge Walmart (NYSE:WMT), Kroger (NYSE:KR) and Albertsons (NYSE:ACI), Amazon (NASDAQ:AMZN) opened the first location of its new chain of Fresh grocery stores in Woodland Hills, California. The 35,000-square foot store features Echo Show devices to ask Alexa where certain items are located, and debuted the Dash Cart, a smart grocery cart that tracks shoppers’ items and allows them to skip the checkout line. There will also be a service counter for people to pick up orders from Amazon.com, and they can also complete returns there without having to package their items in boxes.