Economic Indicators - The Dallas Fed manufacturing activity survey for September unexpectedly fell by -6.9 to -8.7, weaker than expectations of an increase to -1.0 [1] - US pending home sales for August rose by +4.0% month-over-month, significantly stronger than expectations of +0.4% and marking the largest increase in five months [2] - The S&P companies are expected to post +6.9% earnings growth in Q3, up from +6.7% as of the end of May, with over 22% of companies providing guidance expected to beat analysts' expectations [8] Stock Market Performance - Stock indexes experienced a rally, with the S&P 500, Dow Jones Industrial Average, and Nasdaq 100 reaching record highs last week, driven by strong earnings growth and Fed easing measures [4] - On Monday, the S&P 500 Index closed up +0.26%, the Dow Jones closed up +0.15%, and the Nasdaq 100 closed up +0.44% [6] - Chipmakers led technology stocks higher, with GlobalFoundries and Micron Technology closing up more than +3% [14] Interest Rates and Bond Market - The 10-year T-note yield fell by -3 bp to 4.14%, influenced by expectations of weak labor market news prompting the Fed to continue cutting interest rates [5][11] - The 10-year breakeven inflation rate fell to a 1.5-week low of 2.357%, supporting Fed policy and T-note prices [11] Corporate Developments - Merus NV closed up more than +35% after Genmab announced a deal to acquire the company for $8 billion or $97 per share [16] - Electronic Arts closed up more than +4% after a consortium acquired the company for $55 billion or $210 per share [18] - Western Digital closed up more than +9% after an upgrade from Rosenblatt Securities, raising its target on the stock to $125 from $90 [16] Sector Performance - Energy producers retreated after WTI crude oil prices fell by more than -3%, with companies like Diamondback Energy and Devon Energy closing down more than -3% [15] - Rising corporate earnings expectations provide a bullish backdrop for stocks, with significant positive guidance from S&P 500 companies [8]

Company Earnings - Carnival (NYSE: CCL) reported third-quarter earnings of $1.43 per share, exceeding the analyst consensus estimate of $1.32 per share [2] - The company also reported quarterly sales of $8.153 billion, surpassing the analyst consensus estimate of $8.101 billion [2] Stock Movements - Tilray Brands, Inc. (NASDAQ: TLRY) shares increased by 40% to $1.6050 following a video from President Donald Trump promoting cannabis health benefits [8] - Merus N.V. (NASDAQ: MRUS) shares surged 36% to $93.93 after Genmab agreed to acquire the company for $97 per share [8] - Better Home & Finance Holding Company (NASDAQ: BETR) shares rose 17% to $62.23 after announcing a $75 million at-the-market offering for Class A shares [8] - KALA BIO, Inc. (NASDAQ: KALA) shares plummeted 89% to $2.15 after failing to meet primary endpoints in a clinical trial [8] - MoonLake Immunotherapeutics (NASDAQ: MLTX) shares fell 89% to $6.69 due to a failed trial [8] - IO Biotech, Inc. (NASDAQ: IOBT) shares dropped 78% to $0.3501 following an update after a pre-BLA meeting with the FDA [8] Economic Indicators - U.S. pending home sales surged by 4% in August, marking the sharpest gain in five months, compared to a 0.4% decline in the previous month [10] - The Dallas Fed's general business activity index for Texas manufacturing declined to -8.7 in September from -1.7 in the previous month [10]

Core Viewpoint - The articles promote the Growth Stock Forum as a platform for identifying and tracking growth stocks, particularly in the biotech sector, emphasizing attractive risk/reward situations for investors [1][2]. Group 1: Growth Stock Forum Features - The forum includes a model portfolio consisting of 15-20 stocks that are updated regularly [2]. - A top picks list is provided, featuring up to 10 stocks anticipated to perform well in the current calendar year [2]. - The forum offers trading ideas aimed at both short-term and medium-term market movements [2]. Group 2: Analyst's Position - The analyst has a beneficial long position in GMAB shares, indicating a personal investment interest [3]. - The article reflects the author's opinions and is not compensated by any company mentioned, ensuring an independent perspective [3].

Market Overview - U.S. stocks exhibited mixed performance, with the Nasdaq Composite increasing by over 100 points on Monday [1] - Cannabis-linked stocks experienced significant gains following President Trump's video promoting the health benefits of cannabis [1] Company Highlights - Tilray Brands, Inc. (NASDAQ: TLRY) saw a sharp increase in shares, rising 39.2% to $1.5983 [1] - Merus N.V. (NASDAQ: MRUS) gained 36.6% to $94.14 after Genmab agreed to acquire the company for $97 per share [4] - Better Home & Finance Holding Company (NASDAQ: BETR) increased by 20.1% to $63.60, supported by a $75 million at-the-market offering for Class A shares [4] - BTQ Technologies Corp. (NASDAQ: BTQ) jumped 20% to $6.36, as Danal began proof-of-concept for BTQ's quantum-secure Stablecoin settlement network [4] - SNDL Inc. (NASDAQ: SNDL) rose 18.8% to $2.77, benefiting from the positive sentiment around cannabis stocks [4] - Innoviz Technologies Ltd. (NASDAQ: INVZ) increased by 15.6% to $1.9701 after Goldman Sachs upgraded the stock from Neutral to Buy, raising the price target from $1.50 to $2.50 [4] - Sandisk Corporation (NASDAQ: SNDK) shares jumped 14.3% to $111.06 [4] - GDEV Inc. (NASDAQ: GDEV) rose 12.7% to $29.24 [4] - Ondas Holdings Inc. (NASDAQ: ONDS) gained 12.2% to $8.59 [4] - Pony AI Inc. (NASDAQ: PONY) increased by 10.3% to $23.36, with Citigroup initiating coverage with a Buy rating and a price target of $29 [4] - Galaxy Digital (NASDAQ: GLXY) gained 9.5% to $33.85 [4] - Western Digital Corporation (NASDAQ: WDC) rose 9% to $116.48 after Rosenblatt raised its price target from $90 to $125 while maintaining a Buy rating [4] - New Oriental Education & Technology Group Inc. (NYSE: EDU) increased by 5% to $53.85, with B of A Securities maintaining a Buy rating and raising the price target from $56.2 to $58.2 [4] - GLOBALFOUNDRIES Inc. (NASDAQ: GFS) rose 5% to $37.40 following a collaboration announcement with Corning for developing detachable fiber connector solutions [4]

A potential negative factor for market sentiment is the likelihood that the US government will shut down on Wednesday if lawmakers fail to pass a spending bill or continuing resolution (CR) by then. Congressional leaders are scheduled to meet with President Trump later today to negotiate a short-term spending bill. The White House warned last Wednesday that a shutdown would trigger widespread dismissals of employees in government programs that don’t align with President Trump’s priorities.Comments today fro ...

Core Viewpoint - Genmab A/S has agreed to acquire Merus N.V. for $97 per share in an all-cash transaction valued at approximately $8 billion, expected to close by early Q1 2026 [1][2]. Group 1: Acquisition Details - The acquisition is aimed at accelerating Genmab's transition to a wholly owned model, expanding and diversifying its revenue streams for sustained growth into the next decade [2]. - The purchase price of $97.00 per share represents a 41% premium over Merus' closing stock price of $68.89 on September 26, 2025, and a 44% premium over its 30-day volume weighted average price of $67.42 [6]. Group 2: Strategic Fit and Pipeline - Adding petosemtamab, Merus' lead asset, aligns with Genmab's expertise in antibody therapy development and commercialization in oncology, enhancing its late-stage pipeline [3][4]. - Following the acquisition, Genmab will have four proprietary programs expected to lead to multiple new drug launches by 2027 [3]. Group 3: Product Potential - Petosemtamab is an EGFRxLGR5 bispecific antibody with potential first- and best-in-class status in head and neck cancer, showing significantly higher overall response rates and median progression-free survival compared to standard care [4]. - Genmab anticipates the initial launch of petosemtamab in 2027, with plans to broaden its development into earlier lines of therapy [5]. Group 4: Financial Projections - Genmab expects petosemtamab to be accretive to EBITDA, with an estimated annual sales potential of at least $1 billion by 2029, and multi-billion-dollar annual revenue potential thereafter [6]. - The deal is viewed positively by analysts, as it adds an asset with peak sales potential of $3 billion to $4 billion in head and neck cancer alone [7][8].

Group 1: Corporate Earnings and Market Sentiment - Rising corporate earnings expectations are a bullish backdrop for stocks, with over 22% of S&P 500 companies providing guidance for Q3 earnings that are expected to beat analysts' expectations, the highest in a year [1] - S&P companies are expected to post +6.9% earnings growth in Q3, an increase from +6.7% as of the end of May [1] Group 2: Economic Indicators and Federal Reserve Policy - Cleveland Fed President Beth Hammack indicated that inflation is not expected to return to the Fed's 2% objective until late 2027 or early 2028, emphasizing the need for a restrictive policy stance [3] - The market is pricing in an 89% chance of a -25 basis point rate cut at the next FOMC meeting on October 28-29 [6] Group 3: Stock Market Performance - Stock indexes are mixed, with the broader market climbing and bond yields falling due to weak US labor market news reinforcing expectations for additional Fed interest rate cuts [5] - The S&P 500 Index is up +0.39%, while the Dow Jones Industrials Index is down -0.08%, and the Nasdaq 100 Index is up +0.78% [6] Group 4: Sector Performance - Chipmakers are leading technology stocks higher, with notable gains from GlobalFoundries (+4%), Micron Technology (+3%), and Nvidia (+2%) [12] - Energy producers are experiencing declines, with WTI crude oil prices down more than -2%, affecting companies like APA Corp (-3%) and Chevron (-2%) [13] Group 5: Notable Company Movements - Merus NV is up more than +38% following an acquisition announcement by Genmab for $8 billion or $97 per share [14] - Western Digital is up more than +9% after a target price increase by Rosenblatt Securities [14] - Electronic Arts is up more than +5% after a consortium acquired the company for $55 billion or $210 per share [14]

Upgrades - Goldman Sachs upgraded Innoviz Technologies (INVZ) to Buy from Neutral with a price target of $2.50, up from $1.50, citing the company's design potential over the next six months and its "inexpensive" valuation [2] - Morgan Stanley upgraded Citizens Financial (CFG) to Overweight from Equal Weight with a price target of $71, up from $53, highlighting it as one of the "best profitability improvement stories" in the sector [2] - Wells Fargo upgraded Amer Sports (AS) to Overweight from Equal Weight with a price target of $40, up from $38, noting the opportunity to take advantage of the recent selloff and positive expert checks in China [3] - Deutsche Bank upgraded Lam Research (LRCX) to Buy from Hold with a price target of $150, up from $100, based on favorable memory supply/demand conditions and momentum at second-tier foundries [4] - Seaport Research upgraded General Dynamics (GD) to Buy from Neutral with a price target of $376, indicating attractive valuation and potential entry point due to near-term budget battles [5] Downgrades - Freedom Capital downgraded Electronic Arts (EA) to Hold from Buy with a price target of $195, up from $185, following reports of the company being in advanced talks to go private for around $50 billion, reflecting a 17% premium [6] - Seaport Research downgraded CarMax (KMX) to Neutral from Buy with no price target, citing disappointment in growth expectations for comps and earnings in fiscal Q2 [6] - Citi downgraded Merus (MRUS) to Neutral from Buy with a price target of $97, down from $101, after Genmab announced an acquisition of Merus for $97.00 per share, totaling a transaction value of $8.0 billion [6] - Morgan Stanley downgraded Wells Fargo (WFC) to Equal Weight from Overweight with a price target of $95, up from $87, noting limited upside following the removal of the asset cap [6] - Morgan Stanley downgraded U.S. Bancorp (USB) to Equal Weight from Overweight with a price target of $56, up from $52, acknowledging potential pressures on net interest income due to elevated deposit costs [6]

Group 1 - Genmab announced its plan to acquire Merus for approximately $8 billion, significantly boosting Merus's stock price by over 37% [1][3] - Merus is developing petosemtamab, a drug that targets head-and-neck cancer and metastatic colorectal cancer, with potential peak sales estimated between $3 billion to $4 billion for head-and-neck cancer alone [2] - The acquisition is viewed positively as it enhances Genmab's portfolio with late-stage programs that could lead to substantial revenue growth in the 2030s, surpassing previous revenue peaks from Darzalex royalties [2] Group 2 - The deal values Merus at a 41% premium compared to its closing price prior to the announcement, while Genmab's stock experienced a decline of nearly 3% [3] - Analysts have noted that the acquisition is larger than expected, indicating a strategic move by Genmab to strengthen its market position [2][6]

Summary of Genmab's Conference Call on Proposed Acquisition of Merus N.V. Company and Industry - **Company**: Genmab (NasdaqGS: GMAB) - **Industry**: Biotechnology, specifically focused on antibody-based therapies Core Points and Arguments 1. **Proposed Acquisition**: Genmab announced a transformative acquisition of Merus N.V. for $97 per share, totaling approximately $8 billion, expected to close in early Q1 2026, pending regulatory approvals [3][14][21] 2. **Strategic Importance**: The acquisition aligns with Genmab's vision to transition from a royalty-dependent model to a fully integrated biotech company that owns, develops, and commercializes its own medicines [4][5][19] 3. **Pipeline Enhancement**: The addition of petosemtamab (PETO) to Genmab's late-stage pipeline is expected to strengthen its position, with PETO having received two breakthrough therapy designations from the FDA [4][6][12] 4. **Market Potential**: PETO is anticipated to have multibillion-dollar peak sales potential, with an initial launch expected in 2027 [5][19] 5. **Clinical Development**: Genmab is confident in PETO's efficacy, with clinical trials showing a 36% response rate in second-line settings and a 63% response rate in first-line settings when combined with pembrolizumab [11][12] 6. **Financial Outlook**: The acquisition is projected to be accretive to EBITDA by 2029, with expectations of significant profitability in 2026 and meaningful growth in 2027 [16][19] 7. **Investment Strategy**: Genmab plans to invest in R&D and commercialization for PETO while maintaining profitability, with a commitment to rapid deleveraging post-acquisition [15][17][19] 8. **Long-term Vision**: The acquisition is seen as a key step towards achieving Genmab's 2030 vision of improving patient lives through innovative therapies [4][21] Additional Important Content 1. **Clinical Trials**: Two phase 3 trials for PETO are ongoing, with expected top-line data readouts in 2026 [10][60] 2. **Safety Profile**: PETO has shown a manageable safety profile, with infusion-related reactions primarily occurring during the first cycle [13][12] 3. **Competitive Landscape**: The potential for PETO to transform treatment in head and neck cancer is emphasized, particularly in settings where current therapies have limited efficacy [10][62] 4. **Platform Acquisition**: The acquisition of Merus N.V. is not just about PETO but also about integrating Merus's bispecific antibody technology platform, which complements Genmab's existing capabilities [90][92] 5. **Future Development**: Discussions on potential expansion into colorectal cancer are premature until more data is available, but the mechanism of action for PETO shows promise across different cancer types [52][84] This summary encapsulates the key points from Genmab's conference call regarding the acquisition of Merus N.V. and the strategic implications for the company's future in the biotechnology sector.