M&A Boom & Analyst Upgrades Drive S&P 500 Higher

The technology and entertainment sectors are witnessing transformative transactions that are capturing investor attention. Electronic Arts (EA) announced over the weekend it will go private in a massive $55 billion all-cash deal, selling to a consortium of private equity firms including PIF, Affinity Partners, and Silver Lake. The gaming giant’s stock responded with a more than 5% surge premarket, reflecting investor approval of the premium valuation and certainty of an all-cash transaction.

Simultaneously, the long-anticipated separation of TikTok US from its Chinese parent ByteDance is progressing, with Vice President JD Vance confirming the successful completion of the data security separation. The transaction values TikTok US at $14 billion, with Oracle (ORCL), private-equity firm Silver Lake, and Abu Dhabi-based MGX investment fund taking significant stakes. ByteDance’s ownership will shrink below 20%, while original ByteDance investors including General Atlantic, Susquehanna, and Sequoia will maintain stakes in the newly independent entity. Oracle, an S&P 500 component, saw its stock rise 0.9% premarket on the news.

Seaport Global Securities analyst Richard T. Safran upgraded General Dynamics (GD) to buy with a $376 price target, citing attractive valuation despite what he characterized as “indifferent” investor sentiment. The defense contractor’s stock gained almost 2% on the note as Safran suggested that “near-term budget battles and the associated stock weakness could provide a good entry point” for investors seeking exposure to the defense sector.

The gaming sector saw additional analyst activity beyond the EA acquisition news. CICC analyst Zijie Yang initiated coverage on Take-Two Interactive (TTWO) with an outperform rating, potentially encouraged by the broader industry consolidation trend. The move suggests continued confidence in the gaming sector’s growth prospects despite increasing competition and development costs.

Barclays initiated coverage of nuclear power plant startup Oklo (OKLO) with an overweight rating, highlighting the company’s business model as “a developer, owner and operator of nuclear assets” that aims to “build and grow a baseline of cash flows from the facilities that it puts into place from PPA agreements.” The analyst noted Oklo’s 14 GW of non-binding agreements with various customers, including data centers and military outposts, and sees “material upside potential” in the stock, which surged more than 5% premarket.

Carnival Corporation (CCL) delivered better-than-expected results, beating earnings estimates by 11 cents with reported earnings of $1.43 per share in its fiscal third quarter 2025. Revenue also exceeded expectations at $8.2 billion, driving the cruise operator’s stock up 1.5% as trading began. Management provided optimistic guidance, forecasting improved net yields of 5.3% for the remainder of the year, though they cautioned that higher costs could weigh on profit margins.

The collective positive developments across multiple sectors contributed to broader market gains, with the Vanguard S&P 500 ETF (VOO) rising 0.6% in premarket trading. This upward momentum occurred despite growing concerns about a potential federal government shutdown, absent passage of a continuing resolution to maintain funding beyond midnight tomorrow. The market’s focus appears firmly fixed on corporate fundamentals and strategic transactions rather than political uncertainty, at least for the moment.