Melly Alazraki
Toronto, Canada - http://
Arena Shares Continue to Soar
Arena Pharmaceuticals (ARNA), which soared over 10% in Monday morning trading, has set a new 52-week high of $6.75. Over the past month, Arena signed a licensing deal for its potential weight-loss drug, lorcaserin, with Japan's Eisai; released study results for the drug; and got a boost from a decision by a Food and Drug Administration panel on rival's Vivus (VVUS) drug. Arena's shares have more than doubled during that time.The Eisai licensing deal is potentially worth about $1.3 billion. Meanwhile, the study results Arena released showed lorcaserin helped nearly half the patients lose 5% of their weight and improved their chances of keeping it off. Arena's drug did that while exhibiting a safer safety profile than either of its competitors' treatments: Vivus's Qnexa and Orexigen's (OREX) Contrave.
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Stocks Surge on Earnings, Outlooks, Deals
U.S. stocks surged Thursday morning following yet another strong batch of earnings, and despite several weak economic indicators. The Dow Jones industrial average rose about 200 points, or 2%, while the Nasdaq composite jumped 2.3% and the S&P 500 soared 2.1% by noon trading. And stocks were even higher earlier.Earnings results continued to impress Wall Street. This morning, such heavy weights as Caterpillar (CAT), 3M (MMM), UPS (UPS) and AT&T (T) all topped earnings estimates and raised their outlooks. Shares of all four were generally higher in morning trade. Meanwhile, General Motors said it is acquiring auto financier AmeriCredit (ACF) for $3.5 billion.
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Apple Shares Slide Ahead of iPhone 4 Conference
Since hitting a high of $279.01 on June 21, Apple shares have dropped over 7.7% to close Thursday at $251.45. This morning, ahead of its iPhone 4 press conference, Apple shares fell 0.7% by noon trading. The iPhone 4, which was to be yet another smashing success has become a somewhat sore issue. While at first sales of the new phone once again blew past expectations, reports of bad reception and dropped calls immediately tarnished the new must-have gadget. But "antennagate," as it's been dubbed, just began, especially with Apple's response to consumers: avoid gripping the phone in the lower-left corner. Consumer Reports then said it can't recommend the iPhone 4 after tests by its engineers confirmed that the device does indeed have reception problems. And Bloomberg reported that a a senior antenna engineer named Ruben Caballero personally raised concerns about the design to Jobs.
So Apple then announced it will hold a press conference at 10 AM Pacific time on Friday. That's in two hours. What to expect?
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BP Shares Climb on Reports of Asset Sale; Oil Spill Costs Climb Too
BP (BP) shares opened up over 4%. The Wall Street Journal reported the oil giant is in talks with U.S. oil and gas company Apache (APA) and other companies over potential asset sales. The talks are part of the steps BP is taking as it is considering how to pay for the massive oil spill in the Gulf of Mexico.
The Sunday Times earlier reported that BP is in talks to sell up to $12 billion of assets to Apache. The WSJ said on Sunday a deal with Apache could be up to $10 billion and could include stakes in BP's Alaskan oil fields. The Times also mentioned that the Obama administration told Exxon Mobil (XOM) it wouldn't interfere with a bid.
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BP Shares Rally on Takeover Scenarios
BP (BP) shares rallied Wednesday morning after a JPMorgan analyst evaluated a takeover scenario. Shares rose as much as 9% in London, but have cooled off since, up over 5.5% in London. BP ADRs opened over 4% on the NYSE.
BP's stock price has lost about half its value, or about $100 billion in market cap, since the Deepwater Horizon rig exploded on April 20, killing 11 of its crew and creating a massive oil spill in the Gulf of Mexico.
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Wall Street Ignoring Big Pharma -- Should You?
In its weekend edition, Barron's Andrew Bary wonders whether Big Pharma's punishment on Wall Street has gone too far. The sector has fallen out of favor with Wall Street and now has one of the lowest price/earnings ratios of any major sector of the stock market, Bary writes. Investors are staying away from the large pharmaceutical companies ahead of their looming patent cliff, when blockbuster drugs like Lipitor, Plavix and Singulair lose patent protection and lose most of the sales from these drugs to generics. Investors also fear the companies don't have enough new drugs in the pipeline to make up for the lost sales, which could mean big hits to earnings.
But when the Street writes off one of the world's most important industries and with valuations at all-time lows, investors ought to take notice, Bary says. Especially when the average dividend yield of the big drugmakers is 4.8%.
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Pfizer -- Buy While Still Down?
"In the $780 billion global pharmaceutical industry, the world's largest drugmaker, Pfizer (PFE), stands out above its peers," Gene Marcial recently wrote on DailyFinance. "Why then does its stock look uninspired?" he asks.
His question is echoed today by Matthew Harper of Forbes: "Pfizer shares have dropped almost 25% from their peak in January. The steady decline continued even as Pfizer presented strong evidence for a lung cancer drug at a medical meeting this month."
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Analysts Upgrade BP to Buy?
After calls from a U.S. congressman for BP (BP) executives to commit hara-kiri and following President Obama's successful pressure on the company to set up a $20 billion escrow account, cancel $7.8 billion in dividend and sell $10 billion assets, a few analysts decided it couldn't get any worse and upgraded the oil giant shares to buy.It's been nearly two months since BP's Deepwater Horizon rig exploded in the Gulf of Mexico, causing a massive oil spill -- that's still hasn't been resolved -- and the worst environmental disaster in U.S. history. Shares of the company were nearly halved as the cleanup cost estimates have swelled.
And as the agreements with Obama lifted some of the uncertainty, triggering a relief rally, some analysts also opted to upgrade BP shares.
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Covidien Acquiring Somanetics to Expand Medican Devices
Somanetics (SMTS) was the most advancing stock in the Nasdaq Wednesday morning, with shares up more than 31%, or nearly $6 to $24.85. Shares reacted to news that Covidien (COV) is buying Somanetics, acquiring all of the outstanding shares of Somanetics for $25.00 per share in cash, a 32% premium to Tuesday's close. Covidien will pay a total of $250 million, for a total transaction value of approximately $300 million.
Covidien, a drug and medical devices maker, is already the distributor for Somanetics' noninvasive diagnostic equipment called INVOS (In-Vivo Optical Spectroscopy) Cerebral/Somatic Oximeter in Europe, the Middle East and Africa. INVOS monitors patients and continuously measures blood oxygen levels in the brain and in the body to help detect and correct complications.
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Before the Bell: Futures Higher on China Exports; Ahead of Data
U.S. stock market futures advanced higher on Thursday as stocks seem set to rebound from the declines triggered by the energy sector Wednesday. Thursday, stocks got a boost from strong Chinese export data and as both European Central Bank and as Bank of England kept interest rates unchanged as traders awaited U.S. data on labor and trade balance.Overseas, Asian and European markets rose after China said exports rose 48.5% in May, while imports jumped 48.3% last month. As concerns mounted that Europe and its sovereign debt problems would hamper global recovery, these figures provided relief to markets. Meanwhile, the euro rose as the European Central Bank said it is leaving its key interest rate unchanged at 1%. The Bank of England also left its base interest rate at a record low of 0.5% as the economic recovery remains fragile.
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Before the Bell: Futures Higher Ahead of Fed Beige Book
U.S. stock futures edged higher Wednesday morning as concerns about a global recovery eased somewhat following Chinese export data. Investors await the Federal Reserve Beige Book about the economy to be released this afternoon as they hope to extend Tuesday's late stage rally.Overseas, world stock markets reversed course after a weak start Wednesday amid news the state-owned Agricultural Bank of China is readying a record-breaking initial public offering that is expected to raise between $23 billion and $30 billion. Also, Chinese exports jumped about 50% in May from a year earlier, sources told Reuters. Shanghai Composite Index advanced 2.8%. European shares were generally higher as well.
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Before the Bell: Futures Point to Lower Start on Economic Concerns
U.S. stock futures fell sharply Tuesday morning, indicating a continuation of one of the worst Mays on record. This morning, investors are digesting several worrisome news on top of the ongoing concerns over eurozone sovereign debt and global economic recovery. BP's failed "top-kill" operation, disagreements between American International Group and Prudential over the sale of AIG's Asian arm, and Hewlett-Packard's job cuts are a few of the more disconcerting headlines. World stocks fell Tuesday amid similar concerns, enhanced by a report that showed Chinese manufacturing slowed in May, underlining Asian manufacturers and exporters remain vulnerable to waning of demand in Europe and elsewhere. Shares in Asia closed lower, with Japan's Nikkei 225 down 0.6% and Hong Kong's Hang Seng falling 1.4%.
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Before the Bell: Futures Indicate Higher Open Ahead of Data
U.S. stock futures edged higher Friday, as bargain hunters continue to seek oversold stocks. With concerns over eurozone debt woes receding and improved confidence about global economic outlook, investors await several economic indicators due out this morning.U.S. stocks rallied Thursday after China denied it was going looking into its eurozone debt holdings. Market climbed from nine-month low as the Dow Jones Industrial Average surged 284 points, or 2.9%, and the Nasdaq Composite finished the day 3.7% higher. For May, however, the Dow is still 6.8% lower.
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Before the Bell: Futures Point to a Significantly Higher Open
U.S. stock market futures were sharply higher on Thursday, pointing to a rise of some 2% at the open, after China denied a report it was considering cutting its exposure to European debt and continue to hold onto the bonds for now. Meanwhile, investors also await weekly employment data and GDP figures.A report in the Financial Times that Beijing was concerned about its exposure to European debt and was considering selling holdings helped push markets lower despite some upbeat economic news. But the denial by the People's Bank of China turned things around and stocks around the world rebounded with Asian markets closing higher Thursday and European markets up significantly.
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Before the Bell: Futures Point to Rebound Ahead of Housing, Durable Goods Data
U.S. stock futures advanced convincingly higher Wednesday morning following the steep selloff of the past few days. This morning, investors will focus on data, including on durable goods and housing, as concerns over global economic outlook eased somewhat and and global markets stabilized.World stock markets rebounded Wednesday following steep losses the previous day, but sentiment remained fragile amid fears Europe's debt crisis could hamper global economic growth. U.S. Treasury Secretary Timothy Geithner flew to Europe to press for united action to tackle the region's deepening debt crisis. The European Union's top financial chief is proposing that banks should pay a levy to help pay for future bailouts, to ease the burden of multibillion euro (dollar) rescues on taxpayers.
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Comfort Zone Investing: Unconventional Thinking Needed
BP to Begin Scaling Back Oil Cleanup
Oil's Uncertain Economic Outlook
