Monday, June 4, 2007

June 4th - Monday - Gapping up/down

Futures indicate a lower open for the mkt as the Shanghai Composite in China sold off 8.3% today. Note it also plunged 6.5% last Wednesday, weighing on early sentiment; but was labeled as a contained event as the U.S. mkt not only recovered, but rallied. Per usual for a Monday morning, there is quite a bit of M&A news: FLEX has agreed to buy SLR for $3.6 bln, D is selling most of its E&P unit for $6.5 bln, a private equity firm is acquiring a 25% stake in PALM for $325 mln, LEND disclosed it is going private, QGEN is acquiring DIGE, etc.

Notable pre-market Calls include Upgrades: MOT at CIBC, WMT at Wachovia, JP Morgan and HSBC, SIRI, ONXX and PALM at Bear Stearns, NSM at JP Morgan; Downgrades: DB at JP Morgan, CM at RBC, STI at BofA... On the Earnings calendar: BOBE, CMOS, DMND, FCEL and SIGM are the only cos confirmed to report after the close... On the Economic calendar, Apr Factory Orders (consensus 0.6%) will be released at 10:00ET.

Gapping down on weak earnings/guidance
: CRAY -22.6%, KKD 2.3%... Other news: TELK -13.1% (reports Telcyta ASSIST-3 trial results, says assessment of the primary endpoint may have been compromised), CTIC -8.6% (data presented at ASCO provides independent supportive data validating the potential survival benefit of Xyotax), DAL -5.8% (still checking), DNDN -3.1% (announces a $75 mln convertible notes private placement offering).

Gapping up on M&A:
DIGE +36.4% (to be acquired by QGEN for 61.25 per share), SLR +15.7% (to be acquired by FLEX for $3.89 per share), LEND +9.2% (to be acquired by Lone Star Funds for $15.10 per share)... ASCO related news: SCLN +14.4% (thymalfasin achieved its primary endpoint in a phase 2 clinical trial), CYCC +19.7% (reported Phase I sapacitabine data, tgt upped to $12 at Needham), ARIA +7.4% (presents positive efficacy data on AP23573), ONXX +6.1% (announced that Nexavar significantly extends overall survival by 44%)... Other news: PALM +10.0% (announces strategic recapitalization with Elevation Partners, upgraded at Bear Stearns), CDNS +8.7% (NYT reports co is in buyout talks), NVT +6.4% (Cramer highlights recent GOOG-for-NVT rumors).

Courtesy of Briefing.com

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