Three numbers to start your day:
83% Decline in Dollar Volume of Second-Quarter Mergers and Acquisitions
Companies have hit the pause button on mergers this year because of the coronavirus pandemic.
2020 was supposed to be a good year for deals. But the widespread lockdowns, business closures, and job losses have crippled deal-making, particularly in the U.S.
Analysts at Refinitiv say this year’s drop-off in deal activity marks the end of an era. The biggest deal this year has been overseas: Unilever merged two of its subsidiaries into one company based in London, after a failed attempt to move its headquarters to the Netherlands.
That deal was worth almost $107 billion -- bigger than all of the second-quarter deals in the U.S. combined. American deals added up to a little more than $106 billion.
Service Sector Grows in June
57.1 was the latest monthly reading of service-sector economic activity, released on Monday by the Institute for Supply Management. Because it was above 50, it means that the service sector grew in June.
In fact, June was the biggest jump in service-sector activity since ISM started its survey in 1997. The news helped fuel a market rally on Monday.
That doesn’t mean that everything is back to normal, however. This positive reading comes after two consecutive months of contraction in the service sector.
Before the decline in April and May, service sector activity had expanded for more than a decade straight.
And there is more reason for caution. A separate reading of service-sector activity, published by Markit, showed another month of contraction in June.
Uber Stock Rallies 6% Amid Postmates Deal
Uber will pay more than $2.5 billion for Postmates in an all-stock deal.
The offer comes shortly after the ride-hailing app made a failed bid for Grubhub, which was later bought by Just Eat Takeaway, an Amsterdam-based food-delivery app looking to break into the U.S.
Investors are optimistic about Uber’s acquisition because its food delivery service, Uber Eats, has been losing a lot of money. Having one less competitor should help with that.
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