Wall Street steps back from record highs

2016-08-08 22:32:51

Wall Street retreated from record highs on Monday as a drop in healthcare stocks offset the impact of higher oil prices on energy stocks and a strong jobs report.A rally to several all-time highs since late June has left the S&P 500 up nearly 7 percent in 2016, with many investors concerned about stretched valuations."This is a natural pause for reflection by the markets. Everyone is sitting there saying 'Holy cow, what did we do?'," said Brad McMillan, chief investment officer at Commonwealth Financial Network. "Momentum is a big part of it. People are afraid of missing out."Pressured by losses in Bristol-Myers, Merck and Allergan, the S&P 500 healthcare index dipped 1 percent while the Nasdaq biotech index dropped 1.2 percent.Oil prices rose more than 2 percent after a report last week indicated that some OPEC members had called for a freeze in production. [O/R] Investors fretted about growing signs that S&P 500 aggregate earnings could decline for a sixth straight quarter. Analysts polled by Reuters expect third-quarter earnings to fall 0.2 percent, as of Monday. They had estimated a 0.2 percent rise on Aug. 3.At 2:32 pm EDT (1832 GMT), the Dow Jones industrial average was down 0.2 percent to 18,506.48 points and the S&P 500 dipped 0.21 percent to 2,178.31. The Nasdaq Composite dropped 0.34 percent to 5,203.43.Seven of the 10 major S&P 500 indexes fell, with the healthcare group losing the most. The energy index gained 1.45 percent, with Exxon Mobil up 1.1 percent. Bristol-Myers fell for the second straight day, shedding 4.6 percent after it said on Friday its lung-cancer drug failed a key late-stage study. Merck, which makes a rival drug, fell 1.8 percent. The stock had rallied 10 percent on Friday. Allergan lost 2.8 percent after it slashed its full-year revenue forecast and said it was not looking to use its surplus cash to fund any deals.Advancing issues outnumbered declining ones on the New York Stock Exchange by a 1.35-to-1 ratio. On Nasdaq, a 1.18-to-1 ratio favored decliners.The S&P 500 posted 29 new 52-week highs and no new lows. The Nasdaq Composite recorded 90 new highs and 13 new lows. (Reporting by Noel Randewich in New York; Additional reporting by Yashaswini Swamynathan in Bengaluru; Editing by Jeffrey Benkoe)

Asian shares retreat, Australia central bank cuts rate to all-time low

2016-08-02 11:28:36

TOKYO/SINGAPORE Asian shares slipped on Tuesday, taking their cues from a modestly lower day on Wall Street, while crude oil prices stabilized after their overnight tumble and the U.S. dollar edged higher.European markets are set to open flat to slightly lower, with financial spreadbetter CMC Markets expecting Britain's FTSE 100 and France's CAC 40 to open 0.1 percent lower and Germany's DAX to start the day flat. MSCI's broadest index of Asia-Pacific shares outside Japan was down 0.4 percent, after the S&P 500 ended Monday 0.1 percent lower, despite hitting an intraday record high. Australian shares were down 0.6 percent after the Reserve Bank of Australia's policy board decided to cut its benchmark interest rate by 25 basis points to an all-time low of 1.50 percent, as expected. The Australian dollar fell to as low as $0.75 after the RBA decision, but shrank losses to trade down 0.3 percent at $0.7523. Trading in Hong Kong was suspended for the day as Typhoon Nida swept through the city, shutting down most of the financial hub. Japan's Nikkei stock index slipped 1.1 percent. The Nikkei gained more than 6 percent in July, when monetary and fiscal stimulus hopes propelled it to 1-1/2-month highs.Prime Minister Shinzo Abe's cabinet is likely to approve a 28 trillion yen ($273 billion) stimulus package on Tuesday, though direct fiscal spending will total only about 7 trillion yen, according to two people briefed on the matter."The size and rough contents of the package are already known so I doubt it will move markets. The dollar/yen is likely to fall unless there are clearer signs of a rate hike by the Fed," said Shinichiro Kadota, senior FX and rates strategist at Barclays Securities Japan. Japanese government bonds skidded in their worst sell-off in more than three years, despite weaker stocks, accelerating a slide begun in the wake of last Friday's Bank of Japan easing steps that disappointed many investors. The benchmark 10-year JGB yield was up 9 basis points at minus 0.050 percent, touching its highest levels since early April.The dollar reversed early losses and added 0.1 percent to buy 102.45 yen, while the euro was also 0.1 percent higher at $1.1170.The dollar index, which tracks the U.S. currency against a basket of six major peers, was little changed at 95.693, holding above Friday's 95.384, its lowest since July 5. The dollar's upside was heavy on dwindling expectations that the U.S. Federal Reserve is gearing up to hike rates this year, which faded further after Monday's weaker-than-expected manufacturing data. The Institute for Supply Management's (ISM) index of national factory activity dropped to 52.6 in July from 53.2 in June, below market expectations of 53.0.U.S. crude tumbled below $40 per barrel on Monday for the first time since April, on heightened worries of a supply glut despite peak summer gasoline demand. [O/R] But it edged back up on Tuesday, adding 0.1 percent to $40.11 a barrel, after shedding 3.7 percent on MondayBrent crude was 0.4 percent higher at $42.30 after closing down 3.2 percent. (Additional reporting by Shinichi Saoshiro in Tokyo; Editing by Eric Meijer and Sam Holmes)

Sanders supporters boo as he urges them to elect Clinton U.S. president

2016-07-25 22:23:26

PHILADELPHIA Bernie Sanders on Monday urged his supporters to back Democratic rival Hillary Clinton in her White House bid, drawing jeers and shouts of "We want Bernie" in a show of discord as the party kicked off its national convention.The boos underscored the deeply felt anger his convention delegates feel at both Clinton's win and embarrassing emails leaked on Friday suggesting the party leadership had worked to sabotage Sanders' campaign for the nomination. Debbie Wasserman Schultz resigned as party chairwoman on Sunday, a day before the start of the Philadelphia convention to formally nominate Clinton for the Nov. 8 election, and on Monday she bowed to pressure and agreed not to open the convention.Speaking to his supporters, Sanders savaged Republican presidential candidate Donald Trump, calling him a danger to the future of the country who "must be defeated," but some in the room booed when he said "we have got to elect Hillary Clinton" and her vice presidential running mate, U.S. Senator Tim Kaine of Virginia.Sanders, a U.S. senator from Vermont, tried to calm them down. "Brothers and sisters, this is the real world that we live in," he said, adding, "Trump is a bully and a demagogue." Members of the crowd started screaming back: “So is Hillary.”"She stole the election!" someone else shouted.The leak on Friday of more than 19,000 Democratic National Committee emails by the WikiLeaks website put the spotlight back on Sanders' failed bid to win the Democratic nomination, and in particular on his complaints during the campaign that the party establishment was working to undermine him.A democratic socialist, Sanders ran an unexpectedly tough race against former Secretary of State Clinton, galvanizing young and liberal voters with his calls to rein in Wall Street and eradicate income inequality.On Monday, Sanders brought the loudest cheers when he noted that Wasserman Schultz, a U.S. representative from Florida, had resigned as the Democratic National Committee chairman over the email controversy."Her resignation opens up the possibility of new leadership at the top of the Democratic Party," Sanders said, adding that the leadership should be made up of "people who want real change."Wasserman Schultz's resignation is effective at the end of the convention, but on Monday, she told Florida's Sun Sentinel newspaper that she would not speak as planned at the opening of the convention on Monday afternoon. "I have decided that in the interest of making sure that we can start the Democratic convention on a high note that I am not going to gavel in the convention," Wasserman Schultz said. The meeting "needs to be all about making sure that everyone knows that Hillary Clinton would make the best president," she said.The controversy over the emails has been an embarrassing prelude to the convention, which Democratic officials had hoped would convey no-drama competence in contrast to the volatile campaign of Trump. The New York businessman was formally nominated for president at a chaotic Republican convention in Cleveland last week.SHOUTS OF 'SHAME'On Monday morning Wasserman Schultz struggled to be heard above boos as she spoke to the Democratic delegation from her home state. Some protesters held up signs that read "Bernie" and "E-MAILS" and shouted "Shame," as she spoke. The cache of leaked emails disclosed that DNC officials explored ways to undercut Sanders' insurgent presidential campaign, including raising questions about whether Sanders, who is Jewish, was an atheist. Sanders supporters were already dismayed last week when Clinton passed over liberal favorites like U.S. Senator Elizabeth Warren of Massachusetts to select the more moderate Kaine as her running mate."They throw 'party unity' around as if we’re supposed to jump for joy when they mention her name," said Manuel Zapata, a Sanders delegate from California, referring to Clinton. "What we've been saying for months is obviously true: they had the finger on the scale of the campaign," he said. The Clinton camp questioned whether Russians may have had a hand in the hack attack on the party's emails in an effort to help Trump, who has exchanged words of praise with Russian President Vladimir Putin. The FBI said on Monday it would investigate the nature and scope of the hack. Trump gloated at the Democrats' opening day disorder."Wow, the Republican Convention went so smoothly compared to the Dems total mess," he wrote on Twitter. POST-CONVENTION TRUMP 'BUMP'The Republican gathering was overshadowed by accusations of plagiarism in a convention speech by Trump's wife, Melania, and by former presidential candidate Senator Ted Cruz's angry refusal to endorse Trump. In a post-convention "bump," Trump pulled ahead in at least one opinion poll, after lagging Clinton in most national polls for months. A CNN/ORC opinion poll on Monday gave Trump a three-point lead over Clinton, 48 percent to her 45 percent in a two-way presidential matchup. The survey was conducted July 22-24 and had a margin of error of 3.5 percentage points. Clinton, 68, a former first lady and U.S. senator, will be the first woman nominated for president by a major U.S. political party. She waged a months-long battle to defeat the unexpectedly tough challenge from Sanders, 74.Sanders was among those due to speak on the first evening of the convention. Others included President Barack Obama's wife, Michelle Obama.(This version of the story corrects Wasserman Schultz title to U.S. representative from senator, paragraph 10) (Additional reporting by Jrik Tavcar and Doina Chiacu; Writing by Frances Kerry and Alistair Bell; Editing by Howard Goller)

Pfizer walks away from $118 billion AstraZeneca takeover fight

2016-07-19 10:09:03

LONDON/NEW YORK Pfizer abandoned its attempt to buy AstraZeneca for nearly 70 billion pounds ($118 billion) on Monday as a deadline approached without a last-minute change of heart by the British drugmaker.The decision ends a month-long public fight between two of the world's biggest pharmaceutical companies that sparked political concerns on both sides of Atlantic over jobs and corporate tax maneuvers.British rules now require an enforced cooling-off period. AstraZeneca could reach out to Pfizer after three months and Pfizer could take another run at its smaller British rival in six months time, whether it is invited back or not.Pfizer's move came two hours before a 5.00 pm (1200 ET) deadline to make a firm offer or walk away, under UK takeover rules. Its decision to quit the stage, at least for now, had been widely expected after AstraZeneca refused its final offer of 55 pounds a share."Following the AstraZeneca board's rejection of the proposal, Pfizer announces that it does not intend to make an offer for AstraZeneca," Pfizer said in a short news release.The biggest U.S. drugmaker promised it would not go hostile by taking its offer directly to AstraZeneca shareholders, leaving the fate of what would have been the world's largest ever drugs merger in the hands of its target, whose board would have had to make a complete U-turn to get a deal done."We continue to believe that our final proposal was compelling and represented full value for AstraZeneca based on the information that was available to us," said Ian Read, Pfizer's chairman and chief executive.Pfizer's final offer was at a price that many analysts and investors had previously suggested would bring AstraZeneca to the table for serious negotiations. But in rejecting an earlier offer of 53.50 pounds as undervaluing the company, the British group indicated it needed a bid more than 10 percent higher, or at least 58.85 pounds per share, for its board to consider a recommendation.Pfizer had urged AstraZeneca shareholders to agitate for engagement and several expressed disappointment at its intransigence, although others - encouraged by AstraZeneca's promising drug pipeline - backed the firm's standalone strategy.AstraZeneca Chairman Leif Johansson welcomed Pfizer's decision to back down, which he said would allow the British company to focus on its growth potential as an independent company.What happens next will depend upon whether AstraZeneca's share price deteriorates in the coming weeks and how hard its shareholders push for it to revisit a deal with Pfizer. BlackRock, AstraZeneca's biggest shareholder, backed the board's rejection of Pfizer's 55 pounds a share offer, but urged it to talk again in the future.POLITICAL OPPOSITIONThe proposed transaction ran into fierce opposition from politicians in Britain, Sweden - where AstraZeneca has half it roots - and the United States over the likelihood that the marriage would lead to thousands of job cuts.Ultimately, it was price and the lack of room for eleventh-hour maneuvering by Pfizer that killed the deal. Pfizer had several reasons for taking aim at AstraZeneca for what would have been its fourth mega-merger in 14 years.Highest on the list appeared to be Pfizer's desire to take part in a recent trend of so-called tax inversions, under which it could reincorporate in Britain and pay significantly lower corporate tax. Pfizer would also be able to use tens of billions of dollars it has parked overseas, avoiding high U.S. taxes for repatriating the huge cash pile.Pfizer also had its eye on a promising portfolio of drugs in AstraZeneca's developmental pipeline, especially several potentially lucrative cancer medicines.It was this pipeline that AstraZeneca management used to make its case for Pfizer significantly undervaluing the company.Chief Executive Pascal Soriot went as far as making a 10-year forecast for a 75 percent rise in sales by 2023."As we said from the start, the pursuit of this transaction was a potential enhancement to our existing strategy," Pfizer's Read said. "We will continue our focus on the execution of our plans, bringing forth new treatments to meet patients' needs and remaining responsible stewards of our shareholders' capital."The merger would have restored Pfizer as the world's largest drugmaker by sales, a position it relinquished to Swiss-based Novartis when billions of dollars in annual revenue evaporated after its top-selling cholesterol fighter Lipitor began facing generic competition in 2011.(Editing by David Evans and Mark Potter)

Trump says to decide on running mate by week's end: Washington Post

2016-07-11 18:43:54

WASHINGTON Republican presidential candidate Donald Trump said on Monday he expects to select a running mate in the "next three to four days" and that he was leaning toward someone with political rather than military credentials, The Washington Post reported.Trump told the Post in an interview that he had five people under consideration, including retired Lt. General Michael Flynn. (Reporting by Adam DeRose; Editing by Doina Chiacu)

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