Big Biotech Merger – Here’s Who’s Involved
Stocks
were sharply lower Monday. Â A mega merger between Biogen
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Pharmaceuticals
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from Tenet Healthcare
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weighed on the indices. The advance/decline appears to be weakening, and most of
the volume was on the downside today. On the bright side, this quarter so far is
shaping up as th ebest since Q4 1998. As we enter earning warnings season, look
for more possible lowered guidance. Tomorrow marks the start of the two-day FOMC meeting. A 0.25 cut is
expected.
The Dow Jones Industrial
Average
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fell 14.04 at 981.55. The Nasdaq
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No sectors were green.
Weak today were Health
Providers
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Networking
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-3.08%, and Airlines
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No economic news for today.
The 10-year U.S. Note
is +225 at 118 280.
The dollar was up 0.02
at 94.47.
Gold is -3.60 at 353.40.
Crude Oil -0.18 at
28.99.
Volume is at
1,353,896,000
on the NYSE, and at 1,677,257,000 on the Nasdaq.
Market breadth was negative,
with NYSE declining issues over advancing issues by a ratio of 3.02, and down volume
over up volume by a 7.23 ratio. Nasdaq declining issues over advancing
issues at 2.91, and down volume over up volume is at a 5.29 ratio.
Top Dow stocks were:
Altria Group
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+0.35 at 22.37, Coca-Cola
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Stocks in the news:
Advanced Fibre
Communications
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the stock from “equal weight” to “over weight”. Lehman based the upgrade on
attractive valuations and believes that the company could benefit from increased
spending by regional Bell operating companies. Lehman also raises its target
price from $15 to $20. AFCI closed at 16.53, up 0.54.
Cray
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higher on very heavy volume. The supercomputer maker was the subject of
a positive Barron’s article. The article suggested that company could receive
significant contracts from government agencies due to its supercomputers that
can solve complex problems in weeks to months instead of years.
IGEN International
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dipped slightly after the company announced that it had received a $23 million
contract from the Department of Defense. IGEN would provide its Origen
technology to the DOD for detection of biological agents in the environment.
American Capital Strategies
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article. The article raised concerns over the company’s deteriorating loan
portfolio.
Avery Dennison
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is lower by 5.6% on heavy volume after the company lowered second quarter
guidance. Due to slow sales, the adhesive and office supply maker, now expects
earnings between 68 to 72 cents a share. Previously the company was looking from
77 to 82 cents a share.
Biogen
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off 2.25 after the company agreed to be
acquired by Idec Pharmaceuticals in a $6.6 billion stock deal. Separately Biogen
warned that second quarter results would come in between 32 to 38 cents a share
compared to analyst estimates of 42 cents a share.
Tenet Healthcare
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fell 26% on very heavy volumeafter the company warned
that second quarter and full year estimates would be below estimates due to
lower payments from insurers and higher medical costs. Second quarter estimates
for the company were at 34 cents a share, but Tenet said that for the past two
months of the quarter was only 2 cents a share. THC closed at 12.01, down 4.22.