Mergers gain focus in slow global market


NEW YORK: Mergers provided the major action on global equities markets on Monday (Tuesday in Manila) as major indices showed little movement.

Medivation, which makes the hit prostate cancer drug Xtandi, soared 20 percent in New York on the announcement it would be bought by the pharmaceutical giant Pfizer for $14 billion.

The Swiss biotech company Syngenta also added 10 percent after a US national security panel did not object to its proposed $43 billion purchase by the state-owned China National Chemical Corporation.

And the US gas station and convenience store operator CST Brands fell 0.1 percent following the announcement of a deal to be purchased by Canada’s Alimentation Couche-Tard for $4.4 billion.

But the major markets generally had little wind in their sails. In New York, the Dow Jones Industrial Average and the S&P 500 both closed down about 0.1 percent while the tech-heavy Nasdaq, where Medivation is listed, rose by a similar amount.

London’s benchmark FTSE 100 sagged 0.4 percent from Friday’s close while in the eurozone both Frankfurt and Paris gave up early minor gains. The DAX 30 lost 0.5 percent while the Paris CAC 40 fell 0.2 percent.

The FTSE was weighed down by a drop in prices of dollar-denominated industrial and precious metals.

“It’s the FTSE’s commodity contingent that is holding the index back,” said Mike van Dulken, head of research at Accendo Markets.

The dollar strengthened slightly against the euro and then gave back those gains after Fed Vice Chair Stanley Fischer on Sunday said the world’s top economy was close to the Fed’s targets for unemployment and inflation and that GDP growth would pick up, hinting that interest rates could rise before the end of the year.

Chris Low of FTN Financial said the markets were in wait-and-see mode, with a lack of economic data coming this week and a much-anticipated speech from Federal Reserve Chair Janet Yellen due on Friday in Jackson Hole, Wyoming.

“Traders are looking at this and are probably reluctant to take a position on either side of the market as long as there are opportunities for surprises,” Low told AFP.

“The Jackson Hole event has previously been a platform for the Fed to provide more clarity to the markets and warn about upcoming policy changes, something the market is currently in desperate need of,” said Craig Erlam, senior market analyst at Oanda trading group.

Gold prices tumbled. On the London Bullion Market, the price of gold dropped to around $1,337.70 an ounce from $1,346.40 on Friday.


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