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Tuesday 12th of January 2010
December 4, 2006    

US pharma lower on bad news

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by Elaine Frei

The New York equities markets were higher at midday on Monday, helped out by falling oil prices. The Dow Jones Industrial average was 0.5 percent higher to 12,256.78, while the Nasdaq Composite was up 1.3 percent to 2,444.20 and the S&P 500 had added 0.6 percent to 1,405.15. The small-cap Russell 2000 index was up 1.6 percent to 793.32, just below its all-time high.

In the financial services sector, Bank of New York said it will purchase Mellon Financial for $16.5 billion, all in stock. If the deal is closed, it will create the largest financial assets service company, with control of around $16,000 billion. Bank of New York had added 11.1 percent on the news by the middle of the day to $39.41, while Mellon gained 4.4 percent to $42.27.

Station Casinos added 18.7 percent to $82.02 and was up to $82.28 earlier in the day after it said it has received a bid from a group of investors headed by the chairman and chief executive of the company. The offer was said to be worth $4.7 billion.

IBM was 1.6 percent higher to $92.73 on positive notice from the press over the weekend.

The pharmaceuticals sector saw declines after Pfizer and Onyx Pharmaceuticals each received bad news about drugs in trials. Pfizer fell 11.8 percent to $24.58 after dropping as low as $23.52 on the announcement that it has abandoned development of its Torcetrapib, intended to treat high cholesterol, after patients in trials had a high incidence of deaths and cardiovascular events. Meanwhile, Onyx dropped 28.9 percent to $12.44 on the announcement that Nexavar, a drug for the treatment of kidney cancer, had not helped skin cancer patients in trials.

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