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Mid-Morning Market Update: Markets Mostly Lower; Pfizer To Buy Medivation For $14 Billion

PFE, DRD, MRO, VTOL

 


Following the market opening Monday, the Dow traded down 0.09 percent to 18,535.86 while the NASDAQ rose 0.11 percent to 5,244.30. The S&P also fell, dropping 0.05 percent to 2,182.77.

Leading and Lagging Sectors

Monday morning, the healthcare shares gained by 0.44 percent. Meanwhile, top gainers in the sector included Medivation Inc , and Valeant Pharmaceuticals Intl Inc (NYSE: VRX).

In trading on Monday, energy shares tumbled by 1.16 percent. Meanwhile, top losers in the sector included Marathon Oil Corporation (NYSE: MRO), down 7 percent, and Bristow Group Inc (NYSE: BRS), down 5 percent.

Top Headline

Pfizer Inc (NYSE: PFE) and Medivation Inc. (NASDAQ: MDVN) struck a definitive deal through which the former would buy the latter for $81.50 a share in cash. The total enterprise value of the transaction is about $14 billion.

Pfizer expects the deal to be accretive to its adjusted EPS by about $0.05 in the first full year after the closure of the transaction. The company expects additional accretion and growth thereafter. The company doesn't expect the transaction to modify its existing financial outlook for the current year.


Equities Trading UP

CIFC LLC (NASDAQ: CIFC) shares shot up 58 percent to $10.92 after the company agreed to be acquired by F.A.B. Partners for $333 million in cash.

Shares of Medivation Inc (NASDAQ: MDVN) got a boost, shooting up 20 percent to $80.50 as Pfizer Inc (NYSE: PFE) announced plans to buy Medivation for $81.50 a share in cash.

Intersil Corp (NASDAQ: ISIL) shares were also up, gaining 20 percent to $18.72 following a report it was near a deal to be acquired by Renesas Electronics for up to $2.99 billion.


Equities Trading DOWN

Real Industry Inc (NASDAQ: RELY) shares dropped 8 percent to $7.53 as the company announced the resignation of Mr. Craig T. Bouchard as CEO. The company named Mr. Kyle Ross as interim CEO.

Shares of Marathon Oil Corporation (NYSE: MRO) were down 7 percent to $15.70 after the company reported leadership changes. The company reported the departure of executive vice president and CFO J.R. Sult for personal reasons.

DRDGOLD Ltd. (ADR) (NYSE: DRD) was down, falling around 17 percent to $6.69. Gold futures declined 0.4 percent to trade at $1,341.00 an ounce.


Commodities


In commodity news, oil traded down 2.65 percent to $47.81 while gold traded down 0.37 percent to $1,341.20.

Silver traded down 2.06 percent Monday to $18.92, while copper fell 1.06 percent to $2.15.

Eurozone

European shares were lower today. The eurozone’s STOXX 600 fell 0.20 percent, the Spanish Ibex Index dropped 0.32 percent, while Italy’s FTSE MIB Index declined 0.03 percent. Meanwhile the German DAX declined 0.76 percent, and the French CAC 40 fell 0.50 percent, while U.K. shares fell 0.60 percent.

Economics

The Chicago Fed National Activity Index rose to 0.27 in July, versus a prior reading of 0.16. However, economists were expecting a reading of 0.20.

The Treasury is set to auction 3-month bills at 11:30 a.m. ET.

The Treasury will also auction 6-month bills at 11:30 a.m. ET.



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