By Sarah Turner, MarketWatch
Dec 27, 2005
U.S. stock market futures were pointing to a higher start Tuesday, as oil
prices drifted lower and as retail giant Wal-Mart said over the holiday
weekend that December sales would rise in line with forecasts.
On Friday, U.S. stock prices closed almost flat after a light-volume pre-
Christmas session enlivened chiefly by merger news. The Dow Jones Industrial
Average closed down 6.17 points at 10,883.27, the S&P 500 ended up 0.54 point
at 1,268.66 and the Nasdaq Composite ended up 2.93 points at 2,249.42.
Front-month crude oil contracts fell to just below $58 a barrel, and
natural gas prices tumbled, on forecasts of warmer-than-average temperatures
across the U.S. February crude was down 53 cents at $57.90 in electronic trade
and January natural gas slumped 97.3 cents, or 7.9%, to $11.310 per million
British thermal units. The U.S. dollar was mixed, with the buck rising 0.4%
vs. the yen to 116.97 but slipping 0.1% against the euro to $1.1855.
Of companies in focus, Bristol-Myers Squibb rallied 4.1% to $23.88 in
Instinet pre-open trading after the company said late Friday that Orencia, a
treatment for rheumatoid arthritis, had been approved by the U.S. Food and
Drug administration.
Guidant slipped 2.2% to $65.50 in Instinet after the company said it
received a warning letter from the U.S. Food and Drug Administration regarding
a facility in St. Paul, Minn. The FDA was requesting additional action to
address certain quality system concerns. Also, Guidant said it expected
fourth-quarter earnings of 17 cents to 23 cents a share on revenue of $790
million to $820 million, according to a company filing with the Securities and
Exchange Commission late Friday. The Indianapolis medical- device company also
expects 2006 earnings of $1.48 to $1.58 a share, or $1.65 to $1.75 a share on
an adjusted basis, on revenue of $3.8 billion to $4 billion.
Elsewhere in the drug sector, NeoPharm shot up 28% after the company said
an independent data monitoring committee reviewed the data from a Phase III
trial of Precise for the treatment of brain cancer and has recommended that
the trial continue as planned. The company said it was "cautiously optimistic"
for a positive final outcome of the Precise trial
Wal-Mart, the nation's largest retailer, was up slightly in light volume
after saying Saturday that it sees U.S. comparable-store sales for December
rising 2% to 4%, in line with earlier forecasts. Comparable-store sales,
measuring revenue from outlets open at least a year, are a key industry
measure of strength.
Other companies reporting on Tuesday included electricity company Dynegy,
which said it agreed to pay Quachita Power $370 million to terminate its
Sterlington long-term wholesale power tolling contract. Dynegy said it will
take a fourth-quarter pre-tax charge of $360 million. Investors were also
expected to assess some corporate news from Friday.
Par Pharmaceutical Cos. received final clearance from the Food and Drug
Administration for its abbreviated new-drug application for cefprozil, the
generic version of Bristol-Myers Squibb's broad-spectrum cephalosporin
antibiotic Cefzil. Par said it will begin shipping the product immediately.
Annual sales of Cefzil tablets exceed $100 million.
Broker calls
Lehman Brothers upgraded drug maker Regeneron Pharmaceuticals to
overweight from equal weight, citing improving prospects for the company's
Vascular Endothelial Growth Factor Trap anti-cancer treatment. Lehman said
that while data from 19 Phase I and II studies is unlikely to be published
until the second half of 2006, the commercial prospects are attractive enough
to interest investors now.
This MarketWatch news update is provided to you courtesy of Thomson
Financial.
This is Thomson Financial's Market Commentary, which is issued three times
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The information herein is believed to be true and accurate. We take no
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SOURCE Thomson Financial Corporate Group
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