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Spirit Airlines delays buyout vote, Alibaba stock extends gains, Moderna shares pop

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Yahoo Finance Live looks at the news surrounding several of today's trending stocks, including Moderna's updated data on its COVID-19 booster shot and the latest in Spirit Airlines' deal with Frontier.

Video Transcript

RACHELLE AKUFFO: Welcome back, everyone. It is time for our triple play. And I'm kicking us off with what Jared mentioned at the top of the show. It's one of these Chinese tech stocks, is Alibaba. Ticker symbol, BABA. We saw the Chinese e-commerce and tech giant has actually been boosted today by video games. Now the stock jumped to a three-month high after China's gaming regulator approved a list of about 60 publishing licenses for video games.

Now that's a sign that lawmakers are easing up on gaming, as well as the broader tech sector overall, as part of an effort to support the economy after its zero tolerance policy on COVID. And of course, the subsequent outbreaks really took its toll on the world's second largest economy. Now the scrutiny from these Chinese regulators led Alibaba to lose almost half its market value in 2021, with other Chinese tech giants sliding right along with it.

Now some analysts, though, caution that this newfound optimism might be a little bit premature. But US-listed Chinese companies, at least for now, enjoying the gains this week, as investors look for ways to hedge against inflation here in the US.

SEANA SMITH: Yeah, Rachelle, I mean, I think we have to wait and see exactly what comes to this. Certainly, it does seem like investor sentiment seems to be shifting when we take a look at some of these Chinese companies. Alibaba, Baidu both recently beating-- pretty downbeat expectations in their earnings report. And we saw both of those stocks pop on that news.

I think the sentiment around these Chinese stocks is improving, but there's still some hesitation because there was a recent note out from Credit Suisse's Jack Siu, and he was saying Beijing has sent a signal that the regulatory campaign aimed at these tech giants and the internet platforms is due for a pause. But there's a lot of uncertainty just in terms of how long that could continue. So volatility may be expected in some of these names, but at least, today, Alibaba moving to the upside.

All right, my play is Moderna. Now the company saying an upgraded version of its COVID vaccine producing a stronger immune response against the Omicron variant. Now the updated booster shot contains the original vaccine plus the vaccine candidate that targets this specific variant. Now the side effects were similar to booster doses of the original vaccine. Moderna plans to submit the data to regulators in the coming weeks and expects to get approval later this summer, Dave. And you can see the reaction in the stock today, with shares moving up to the upside, just about 2 and 1/2%.

DAVE BRIGGS: Yeah, I'll tell you what. It seems like we have fallen asleep at the switch. That is great news. But the amount of COVID cases we are seeing on a daily basis now well over 100,000 per day, easily the highest in the world. "The New York Times" was 114,000 yesterday. Largely, the American public has fallen asleep and has turned the page. Hopefully, they start paying attention.

The question is, when it comes to this vaccine and others, Seana, is, are they keeping up with the virus? Because it may be evolving faster than the pharmaceutical companies. News today that the BA.4 and BA.5 variants are now 13% of cases. That's up from 7% a week ago. In just a week, this thing is evolving perhaps way too fast for the vaccines. That's problematic.

My play is Spirit Airlines, with news today that they'll postpone their shareholder vote on that Frontier acquisition, just days after JetBlue really sweetened the offer for the low cost airline. JetBlue offering a $350 million reverse breakup fee if the deal was not approved by regulators, which many feel, at this point, it would not be. And that topped the offer by Frontier. They also sweetened their offer to $250 million if regulators do not approve that acquisition.

Now, in a note to staff Wednesday, Spirit CEO Ted Christie said they are still bound by its merger with Frontier. And the company's board has not determined if the JetBlue offer was yet superior to what Frontier is offering, which it appears, at least on the surface. Now the market on all three is pretty much meh. They are all three down. Spirit down 2%, as we speak. Frontier down 4%, as we speak. And JetBlue also down 4 plus percent on the day.

RACHELLE AKUFFO: I mean, we're really seeing a lot of movement in this space. A lot of, will they, won't they, whether it's the regulators. We're also seeing that Spirit is saying that it assessed it did not have enough shareholder support in favor of the deal with Frontier. And that's according to Reuters.

And that's even after this enhanced deal with the $250 million. It'll be interesting to see where the dust settles with this with some of these lower budget carriers. Obviously, you have the four big airlines really controlling the market share there. So it's interesting to see what the smaller carriers can do there and perhaps get some merger action going and give them a run for their money.

SEANA SMITH: And guys, I think the average viewer here, not so much the investor, is more concerned about what this could potentially mean for ticket prices, right? We've seen consolidation in this sector. Ticket prices are already soaring, jumping pretty significantly, 30% most recently. We're heading into the summer heavy travel couple of months. People are worried about how much they could be paying, not only for this summer, looking ahead to the holiday season. More consolidation in the sector, especially among the budget carriers, could potentially mean higher prices for consumers.

DAVE BRIGGS: Hard to imagine that Spirit being acquired is at all good news for the consumer. If there is one slight bit of good news in the industry right now for the consumer, it's eight, eight new low cost airlines have popped up since 2020 alone, which is a staggering number in this environment. So there are more low cost options for the consumer. But you do have to look hard. Smaller airports, do a little bit of homework, google. Those great piece in "The New York Times" referencing all those new airlines.