Editor
This Tuesday, there’s a lot happening on Wall Street, with news about deals, regulations, and some cautious comments from analysts affecting prices of several big companies. Stocks are swinging up and down. For example, there’s talk about Starbucks possibly selling a huge stake in its China business, and UnitedHealth is facing new issues. Let’s dive into what’s moving these stocks.
Starbucks Eyes $10B Valuation in China Stake Talks
Starbucks’ stock went up almost 2% before the market opened after CNBC shared news that investors are showing strong interest in the company’s operations in China, with some bids reaching as high as $10 billion.
Although formal bids are still being organized, insiders mention that any deal probably won’t finalize until 2026 at the earliest.
Jennifer Lu, a retail analyst at Pacific Equity Partners, noted that this could be a key moment for Starbucks in Asia. The company is facing challenges in the U.S. market, and their business in China has always been a standout asset.
While investors are feeling cautiously hopeful, Starbucks has been struggling with sales growth in the U.S., and selling part of its fast-growing China business might either bring value or raise concerns about the timing.
Verona Pharma Soars 20% on Merck Buyout
This morning was a great one for Verona Pharma, as their stock rose by 20%. This happened after Merck, a major pharmaceutical company, announced it would buy Verona for around $10 billion. The move is intended to strengthen Merck’s offerings in respiratory treatments.
Dr. Alan Geller from Cressida Capital pointed out that Merck has been looking for new products since it’s dealing with some patent expirations. He believes this acquisition will give Merck a solid position in the market for COPD treatments.
Merck’s stock also went up slightly, which suggests that investors are generally on board with this decision, even if it comes with a hefty price tag.
AES Surges on Sale Rumors
AES Corp., based in Arlington, saw its stock jump by almost 14% after Bloomberg reported that the company might be considering a sale due to interest from funds focused on infrastructure. While we don’t have many specifics, this increase suggests that investors believe a deal or major change could be coming. Mark DeLuca from Holborn Research pointed out that investors in infrastructure have plenty of money, and AES’s combination of renewable and traditional energy assets is appealing right now.
UnitedHealth Slips as DOJ Investigates Billing Practices
Not every headline brings good news.
Shares of UnitedHealth dropped over 1% after the Wall Street Journal reported that the Department of Justice is looking into the company’s Medicare billing practices for potential fraud. This investigation adds to the regulatory challenges UnitedHealth is already facing from officials in Washington.
Helen Boyd, a healthcare compliance attorney based in D.C., noted, “This type of news can unsettle investors. It’s not just the investigation itself, but also the possibility that it could escalate to other areas of the business.”
Other Movers: Downgrades and Disappointments
WPP saw a nearly 16% drop after the advertising company warned that its performance for the second quarter would be weaker than expected and lowered its outlook for the entire year. They’re now anticipating a decline in both revenue and profit margins.
Mobileye Global fell by almost 2% after Intel revealed it plans to sell 45 million shares of the autonomous vehicle company in a secondary public offering.
SolarEdge Technologies dropped more than 2% after Goldman Sachs changed its rating from “buy” to “neutral,” mentioning concerns about uncertainty in the residential energy market.
On a brighter note, Bloom Energy rose over 6% after being upgraded by JPMorgan, which highlighted benefits from new clean energy tax incentives that could boost earnings.
Looking Ahead: Markets Reacting Sharply to Corporate Headlines
From M&A optimism to regulatory fears, Tuesday’s premarket action underscores a recurring theme in 2025: corporate headlines can move stocks faster — and more dramatically — than macro data.
“Earnings matter, sure,” said DeLuca. “But right now, it’s about storylines — who’s buying, who’s selling, who’s under investigation. That’s where the action is.”
As markets open, all eyes will be on whether these moves hold — or reverse — when trading begins in earnest.
