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Musk shelves $44-billion Twitter deal ‘temporarily’, shares slump

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© Reuters. FILE PHOTO: Elon Musk’s Twitter profile is seen on a smartphone placed on printed Twitter logos in this picture illustration taken April 28, 2022. REUTERS/Dado Ruvic/Illustration

By Nivedita Balu

(Reuters) -Elon Musk put his $44-billion deal for Twitter Inc (NYSE:TWTR) “temporarily on hold” on Friday while he awaits data on the proportion of its fake accounts, sending the shares in the social media platform plunging.

Twitter shares fell 17.7% to $37.10 in premarket trading, their lowest level since Musk disclosed his stake in the company in early April and subsequently made a “best and final” offer to take it private for $54.20 per share.

Meanwhile, Tesla (NASDAQ:TSLA) shares, against which Musk has secured $6.25 billion in funding for the acquisition, were up about 5%.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Musk told his more than 92 million Twitter followers on Friday.

In his latest tweet, Musk referred to a Reuters story from May 2 that said Twitter had estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter, when it recorded 229 million users who were served advertising.

“This 5% metric has been out for some time. He clearly would have already seen it… So it may well be more part of the strategy to lower the price,” Susannah Streeter, an analyst at Hargreaves Lansdown (LON:HRGV).

“It’s going to be highly frustrating for many in the company given that a number of senior executives have already been laid off,” she said.

The implied probability of the deal closing at the agreed price fell below 50% for the first time on Tuesday, when Twitter shares dropped below $46.75. [nL5N2X20IT

Musk, the world’s richest man and a self-proclaimed free speech absolutist, had said that one of his priorities would be to remove “spam bots” from the platform.

Twitter did not immediately respond to a request for comment. Musk’s representatives or his company Tesla Inc were not immediately available for a comment.

Musk has been critical of Twitter’s moderation policy. He has said he wants Twitter’s algorithm to prioritize tweets to be public and was against too much power on the service to corporations that advertise.

Earlier this week, he said he would reverse Twitter’s ban on former U.S. President Donald Trump when he buys the social media platform, signaling his intention to cut moderation of the site.

The social media company had said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter amid “potential uncertainty regarding future plans and strategy.”

Musk will have to pay a termination fee of $1 billion if he walks away from the deal.

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FDA to soon authorize Pfizer’s COVID booster shot for younger kids – NYT

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© Reuters. FILE PHOTO: Empty vials of the Pfizer-BioNTech coronavirus disease (COVID-19) vaccine are seen at The Michener Institute, in Toronto, Canada January 4, 2021 in this file photo. REUTERS/Carlos Osorio/File Photo

(Reuters) -U.S. health regulators are expected to authorize a booster shot of Pfizer/BioNTech’s COVID-19 vaccine for children aged 5 to 11 as soon as Tuesday, the New York Times reported on Monday, citing people familiar with the matter.

The companies submitted an application to the U.S. Food and Drug Administration for the authorization last month.

They have cited data from a mid- to late-stage study showing a third dose of their shot increased protection against the original coronavirus version and the Omicron variant among children in the age group.

It is unclear how much demand there is for the third dose in the age group. Just 28.8% of children aged 5 to 11 are fully vaccinated, according to data from the U.S. Centers for Disease Control and Prevention.

A meeting of outside vaccine experts on an advisory committee to the Centers for Disease Control and Prevention has been scheduled for Thursday, the report https://www.nytimes.com/2022/05/16/us/politics/fda-pfizer-booster-children.html?searchResultPosition=1 said.

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Wall Street ends lower as Tesla falls, while energy rallies

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© Reuters. Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., May 12, 2022. REUTERS/Brendan McDermid/File Photo

By Amruta Khandekar and Noel Randewich

(Reuters) – Wall Street ended lower on Monday, with energy stocks rallying and Tesla (NASDAQ:TSLA) and other growth stocks losing ground after downbeat Chinese economic data added to worries about a global slowdown and rising interest rates.

China’s economic activity cooled sharply in April as widening COVID-19 lockdowns took a heavy toll on consumption, industrial production and employment, adding to fears the economy could shrink in the second quarter.

However, energy stocks got a lift from optimism that China would see significant demand recovery after positive signs that coronavirus pandemic was receding in the hardest-hit areas.

The S&P 500 energy index rallied to a 2014 intra-day high, and it was the strongest performer among 11 sector indexes.

Investors questioned whether a strong day on Wall Street last Friday might signal the end of a recent sell-off that has left the S&P 500 down about 16% from its record high close in January.

“After the big rally on Friday, people are looking around and asking whether it feels sustainable,” said Ross Mayfield, an investment strategist at Baird in Louisville, Kentucky. “Does it feel like the momentum thrust you would see coming off of a low, or is there still more of a capitulation to be worked out?”

Many of Wall Street’s megacap growth stocks were lower, with Amazon (NASDAQ:AMZN) and Google-owner Alphabet (NASDAQ:GOOGL) losing ground and weighing on the S&P 500 and Nasdaq.

Twitter (NYSE:TWTR) extended losses after Bloomberg reported that Elon Musk said a deal to buy the social media company at a lower price than his previously agreed $44 billion was “not out of the question.”

Tesla, which Musk leads, also fell.

The S&P 500 healthcare sector index rose, lifted by a jump in Eli Lilly & Co (NYSE:LLY) after the drugmaker won U.S. approval for tirzepatide, to treat adults with type 2 diabetes.

Investors have been worried that aggressive interest rate hikes by the U.S. Federal Reserve to combat decades-high inflation could tip the economy into a recession, with the conflict in Ukraine, supply chain snarls and the pandemic-related lockdowns in China exacerbating the economic troubles.

Data on Monday showed factory activity in New York state slumped in May for the third time this year amid a collapse in new orders and shipments.

Traders are now pricing a near 86% chance of a 50-basis-point hike by the Fed in June.

According to preliminary data, the S&P 500 lost 15.24 points, or 0.38%, to end at 4,008.65 points, while the Nasdaq Composite lost 140.81 points, or 1.19%, to 11,664.19. The Dow Jones Industrial Average rose 39.07 points, or 0.12%, to 32,235.73.

Investors are focused on retail sales data due on Tuesday, following worrying inflation and consumer sentiment data last week.

Retailers including Walmart (NYSE:WMT) Inc, Home Depot (NYSE:HD) and Target Corp (NYSE:TGT) are due to report their quarterly results this week.

Spirit Airlines (NYSE:SAVE) rallied after JetBlue Airways (NASDAQ:JBLU) launched a hostile takeover bid for the discount carrier. JetBlue shares slipped, while shares of rival bidder Frontier Group gained.

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Take-Two Earnings Miss, Revenue Beats In Q4

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© Reuters. Take-Two Earnings Miss, Revenue Beats In Q4

Investing.com – Take-Two (NASDAQ:TTWO) reported on Monday fourth quarter earnings that missed analysts’ forecasts and revenue that topped expectations.

Take-Two announced earnings per share of $0.95 on revenue of $930M. Analysts polled by Investing.com anticipated EPS of $1.01 on revenue of $883.34M.

Take-Two shares are down 38.04% from the beginning of the year, still down 43.77% from its 52 week high of $195.82 set on November 5, 2021. They are under-performing the S&P 500 which is down 15.86% from the start of the year.

Take-Two shares gained 1.92% in after-hours trade following the report.

Take-Two follows other major Communication Services sector earnings this month

Take-Two’s report follows an earnings missed by Alphabet C on April 26, who reported EPS of $24.62 on revenue of $68.01B, compared to forecasts EPS of $25.59 on revenue of $68.06B.

Meta Platforms had beat expectations on April 27 with first quarter EPS of $2.72 on revenue of $27.91B, compared to forecast for EPS of $2.56 on revenue of $28.28B.

Stay up-to-date on all of the upcoming earnings reports by visiting Investing.com’s earnings calendar

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