The Dow Jones Industrial Average (^DJI +2.49%) was up about 0.2% at 1 p.m. EST Wednesday as the U.S. House of Representatives debated a historic second impeachment of President Donald Trump. The impeachment effort will likely draw some Republican support.
The Dow rose despite a record 4,400 U.S. deaths reported for Tuesday attributed to the COVID-19 pandemic, according to Johns Hopkins University. While effective vaccines should eventually put an end to the pandemic, the situation could get a lot worse before it gets better.
Turning to individual stocks, shares of Intel (INTC +7.14%) rose after the company announced that it was replacing its CEO, while shares of Visa (V +0.86%) edged higher even after its acquisition of fintech company Plaid fell apart.
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Intel to replace CEO
Chip giant Intel has fallen behind competitors on multiple fronts. The company has watched as rival Advanced Micro Devices staged a comeback, stealing share in the desktop, laptop, and server CPU markets. Manufacturing stumbles have been part of the problem: Intel has faced chronic delays, and the company no longer has any sort of technological edge over third-party foundries.
Intel announced on Wednesday that CEO Bob Swan was stepping down effective Feb. 15. Swan will be replaced by Pat Gelsinger, the current CEO of virtualization software provider VMware. This move comes just weeks after activist investor Daniel Loeb called for Intel to make big changes, including potentially spinning off its manufacturing operations.
Intel said the CEO change was unrelated to the company's 2020 financial performance. The company also said that it expects to exceed its guidance for fourth-quarter revenue and earnings per share and that it will provide an update on its delayed 7nm process technology when it reports its results on Jan. 21.
The management shuffle was welcomed by investors, who sent the stock up about 7.5% by early Wednesday afternoon. Intel stock has languished over the past year due to a variety of factors, including the manufacturing stumbles, a resurgent AMD, and the prospect of ARM-based server chips going mainstream, driven by the pending acquisition of ARM Holdings by NVIDIA.
Even factoring in Wednesday's rally, Intel stock is still down slightly over the past year.
Visa gives up on acquiring Plaid
Credit card giant Visa has abandoned its efforts to acquire fintech company Plaid. Visa announced on Tuesday that the two companies had mutually agreed to terminate the merger agreement. Visa originally announced the $5.3 billion deal in January of 2020.
The U.S. Department of Justice sued to block Visa's acquisition of Plaid in November, filing a civil antitrust suit alleging that Visa was making the acquisition to protect its lucrative debit business. The DOJ said that Plaid was developing a payments platform that would challenge Visa's debit monopoly and that Visa was trying to buy the company to eliminate a potential competitive threat.
Plaid allows apps to connect to consumers' bank accounts. The company's technology powers many fintech apps, making it a leading financial data-aggregation company. The DOJ's lawsuit contends that a money-movement platform offered by Plaid could leverage its existing technology and bank account connections and allow it to disrupt Visa's monopoly.
Visa believes it would have prevailed in court, but the company said it was dropping the effort because a "protracted and complex litigation will likely take substantial time to fully resolve."
Shares of Visa were up about 0.8% by early Wednesday afternoon. While investors don't seem to mind that the acquisition fell apart, an eventual disruption of Visa's debit business could hurt the stock down the road.
