Merger, Home Sales Lift U.S. Stocks

123jump.com Staff
26 Jan, 2009
New York City

U.S. stocks edged higher after a mega merger between Pfizer and Wyeth. The existing home sales rose unexpectedly 6.5% in December. Earnings dominated trading sentiment. Caterpillar and Deere & Company fell on weaker than expected outlook. Gold rose above $900 per ounce.

[R]5:00PM New York – 11:00PM Frankfurt, 4:00AM Sydney – U.S. stocks rose after Pfizer offered 33% premium for Wyeth and sale of existing homes rose in December.[/R]

Pfizer agreed to acquire for $68 billion Wyeth. The largest deal between two pharmaceutical companies in a decade will create one of the largest and diversified drug companies in the world.

Earnings and merger news dominated movers in trading. Caterpillar and Deere & Company dropped on earnings outlook. Morgan Stanley and Bank of America rose after earnings fees for arranging a merger between Pfizer and Wyeth. Lennar surged after an analyst upgraded the stock.

Stocks in Japan fell on the worries that auto exports and domestic sales will fall. Media reports also suggested that Nomura may suffer a loss of as much as 300 billion in the latest quarter largely on Madoff scandal in the U.S. Nissan predicts a sharp fall in global vehicle sales.

American Markets Reviews

Dow Jones Industrial Average increased 38.47 or 0.5% to a close of 8,116.03, S&P 500 rose 4.6 or 0.6% to 836.57, and Nasdaq Composite Index increased 12.17 or 0.8% to a close of 1,489.46. In Toronto TSX Composite increased 28.54 or 0.33% to close at 8,656.51.

In Latin American trading Brazil Bovespa Index increased 1% or 377.10 to 38,509.45 and Mexico Bolsa Index edged higher 1.2% or 234.27 to 19,538.08.

Argentina rose 0.1%, Chile increased 0.8%, Peru fell 0.1% and Colombia edged higher 1.1%. Venezuela edged up 0.2%.

U.S. Stock Movers

Of the S&P 500 index, 261 declined, 234 increased and 5 are unchanged.

Aflac Inc led decliners in the S&P 50 index with a loss of 13.4% followed by losses in Rohm & Haas of 13.4%, in U.S. Bancorp of 13.3%, in Regions Financial of 13%, in Zions Bancorp of 11.9% and in Pfizer Inc of 10.5%.

Lennar Corp led gainers in the S&P 500 index with a rise of 10.3% followed by increase in Ford Motor Company of 9.5%, in Freeport McMoran of 9.3%, in Noble Corp 8%, in Danaher Corp of 7.8% and in Quest Diagnostic of 7.5%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 63.11 or 0.81% to 7,682.14 Markets of Hong Kong, China, Australia and Malaysia was closed today.

SET index in Thailand closed higher 3.21 or 0.74% to 436.73. Markets of South Korea, Indonesia and India were closed today.

Europe Markets Review

In London FTSE 100 Index closed higher 156.54 or 3.86% to 4,209.01, in Paris CAC 40 Index increased 106.23 or 3.73% to close at 2,955.37 and in Frankfurt DAX index higher 147.93 or 3.54% to close at 4,326.87. In Zurich trading SMI increased 110.16 or 2.08% to close at 5,417.07.

Commodities, Bonds and Currencies

Yields on 10-year bond increased to 2.64% and on 30-year bonds increased to 3.38%.

The U.S. dollar fell to $1.322 to a euro and against the Japanese yen fell to 89.02 yen.

Immediate futures prices of Texas crude oil decreased to $0.77 to $45.70 a barrel, for natural gas decrease 2 cents to $4.49 per mbtu and gasoline prices decreased 0.13 cents to 115.31 cents a gallon.

Futures of corn increased 3.25 cent to $3.93, soybean were unchanged to $10.009, sugar increased 0.22 cents to 12.92 a pound and wheat increased 9.75 cent to $5.92 a bushel.

In metals trading, copper prices rose 11.45 cents to $1.5860 a pound, gold increased $13.00 to $908.80 per ounce and silver increased 17 cents to $12.11.