Capital One and Discover jump after getting green light to close their $35 billion megamerger

The tie-up will create the sixth-largest US bank and could reshape the credit card landscape.

4/21/25 2:52PM

Shares of Capital One and Discover ticked higher on Monday, defying the broader market slump, after US banking regulators signed off on their $35 billion megamerger.

The approval from the Office of the Comptroller of the Currency and the Federal Reserve, which landed on Friday during the stock market holiday, cleared the final regulatory hurdle for the deal. It paves the way for Capital One to absorb Discover and become the sixth-largest US bank, with more than $650 billion in assets. The deal was first announced in February of last year.

As part of the approval, Capital One agreed to comply with an existing consent order including a $100 million penalty Discover was hit with for overcharging certain interchange fees between 2007 and 2023.

More than just a size boost, the merger gives Capital One something it’s never had: its own card network. Discover’s payment network is one of the few that rival Visa and Mastercard(the largest credit card processors in the world), giving the company a stronger hand in a tightly consolidated space.

The deal could help spark optimism for other bank stocks — especially if it signals that the Trump administration is taking a more merger-friendly stance after recent market volatility cast doubt on the dealmaking space. Capital One expects the deal to close in May, pending standard market conditions.

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eBay stock slumps on gloomy Q4 outlook despite solid Q3 earnings

Shares of eBay fell as much as 10.5% in premarket trading on Thursday morning after the company gave a lower-than-expected profit forecast for the important holiday shopping season.

The e-commerce giant reported solid numbers for the third quarter on Wednesday, with revenue up 9% as reported to $2.8 billion and gross merchandise volume rising 10% to $20.1 billion, topping the average analyst forecast of $19.4 billion, per Bloomberg.

However, concerns about the future somewhat overshadowed these results.

eBay outlined its profit outlook for the period ending in December to $1.31 to $1.36 a share, with revenue at $2.83 billion to $2.89 billion. According to Bloomberg-compiled data, this broadly matches Wall Street’s estimates for the top line, but misses on the bottom line, with analysts forecasting EPS to come in at $1.39 — suggesting the company expects some further margin pressure.

The company has been facing macroeconomic challenges since the US ended the de minimis tariff exemption in late August, with the online marketplace reliant on shipments. One small silver lining? CFO Peggy Alford highlighted a “less durable trend” on a post-earnings call: that as commodity prices for precious metals boomed, demand for bullion and collectible coins on eBay spiked.