Category: Stock Market News

Shares of Dynavax Technologies Corp. plunged 71% toward an eight-year low in premarket trade Monday, after the Food and Drug Administration didn’t approve its Hepatitis B treatment. The company said it received a complete response letter (CRL), which means the FDA completed its review but is requesting additional information, regarding its biologics license application (BLA) for Heplisav-B for adults. The “several” topics that CRL requests information on includes clarification regarding specific adverse events of special interest, a numerical imbalance in some cardiac events and analysis of the integrated safety data base across different time periods. “The CRL is consistent with our opinion that HEPLISAV-B is approvable and we are seeking to meet with the FDA as soon as possible,” said Chief Executive Eddie Gray. “However, the time and resources that will be required to gain approval leads us to consider that we may not be able to advance this program on our own and we are moving swiftly to identify a potential pharmaceutical or financial partner.” The stock has tumbled 52% year to date through Friday, while the S&P 500 has gained 5.9%.

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Shares of Corbus Pharmaceuticals Holdings Inc. more than doubled in premarket trade Monday, after the drug maker announced positive results from a trial of its treatment for systemic connective tissue disease. A Phase 2 trial of Resunab for the treatment of diffuse cutaneous systemic sclerosis was safe and met its efficacy endpoints. “The positive results of this study exceed our expectations and validate the unique mechanism of action of JBT-101,” said Chief Executive Yuval Cohen. “We look forward to the next stages in the clinical development of this drug.” The stock soared 114% toward the highest price seen since the company went public in late 2014. It has rocketed nearly 4 fold so far this year, while the SPDR S&P Pharmaceuticals ETF has tumbled 19% and the S&P 500 has gained 5.9%.

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Ventas Inc. announced Monday a deal to sell 36 skilled nursing facilities it owns, and operated by Kindred Healthcare Inc. , to Kindred for $700 million. The deal is part of Kindred’s previously announced plan to exit its skilled nursing facilities (SNF) business, or renew the current lease on all unpurchased SNFs through 2025 at current rent levels. For the SNFs Kindred operates but doesn’t buy from Ventas by April 30, 2018, the leases will be automatically renewed at current rates. Ventas will record a gain of over $600 million if the deal is completed, but there is no assurance of when the deal will close, if it closes. Neither stock was active in premarket trade. Year to date, Kindred’s stock has tumbled 45%, Ventas shares have gained 4.1%, the SPDR Health Care Select Sector ETF has slipped 2.1% and the S&P 500 has tacked on 5.9%.

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New York-based activist investor Caerus Investors has sent a letter to the management of luxury handbag and accessories maker Kate Spade urging the company to pursue a sale of the company. The investor says it is deeply concerned about the decline in the company’s share price of the last two and half years and of the company’s inability to achieve the profit margins of its peers. “Given the market’s lack of faith in the current management team, as evidenced by the 63% decline in the shares since the intraday high on August 11th, 2014, we believe the best path for enhancing shareholder value is to pursue a sale of the company,” said the letter. “We strongly believe that a strategic, industry player would be willing to pay a substantial premium to add this growth business to their portfolio.” Caerus said it first invested in the company under then parent Liz Claiborne in 2009, on the basis that Kate Spade was mispriced inside a company with other assets that were underperforming and argued for a breakup of that company, which came in 2013. The stock rose above $40 the following year. “Since those successful moves, material shareholder value has been destroyed by wasting time, energy and money on the former sub brand Kate Spade Saturday and management has missed interim sales and margin targets on 3 different occasions,” said the letter. Kate Spade shares were not yet active in premarket trade, but are down 6.5% in the year to date, while the S&P 500 has gained 6%.

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Siemens AG said Monday it has agreed to buy U.S.-based Mentor Graphics Corp. in a merger deal worth $4.5 billion. The German engineering company will pay $37.25 in cash for each share of Mentor, which makes software for automating the design of chips, boards and other electronic products. The offer price is a 21% premium to Mentor’s closing share price on Friday, the companies said in a joint statement. Mentor’s board of directors is recommending the approval of the merger, they said, and key Mentor shareholder Elliott Management has committed to supporting the deal. Siemens shares rose 1.3% in early trade, while Mentor shares were inactive in early premarket trading.

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Shares of Digi International Inc. soared in Friday’s extended session after Belden Inc. made public its proposal to buy the modem company for $13.82 a share. The all-cash deal values Digi at around $380 million. Belden had initially approached Digi last week but was rebuffed. In disclosing its offer, Belden is appealing directly to Digi’s shareholders to persuade them of the “compelling strategic fit inherent in a combination of the two companies.” Shares of Digi finished at $11.65 a share on Friday and surged 21% after hours. Belden’s stock was flat after closing at $69.70.

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An earthquake measuring 6.2 on the Richter scale struck about 250 miles north of Tokyo early Saturday local time on Japan’s east coast, the U.S. Geological Survey said. The quake was centered in Ishinomaki, in the same vicinity as the devastating Tohoku earthquake that claimed thousands of lives in 2011. No tsunami warning has been issued at this time.

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The iShares 20+ Year Treasury Bond ETF declined 0.6% to 122.04 on Friday and ended the week 7.4% lower, its biggest weekly loss since inception in 2002. Over the past few days, trading volume of the ETF shot up. On Wednesday and Thursday, more than 50 million shares changed hands, according to FactSet. The 30-day average daily volume is about 8 million shares. Investors withdrew money from bonds funds as yields on long-term Treasuries jumped over the past week to their highest levels since January 11. The yield on 10-year Treasury bond rose 33.5 basis points to 2.12%, while the yield on 30-year bond rose 35.8 basis points to 2.93%. Bond markets were closed on Friday for Veterans Day.

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The Dow Jones Industrial Average on Friday rose modestly for a fifth session in a row to close at a new all-time high, and booked its largest weekly gain since December 2011. Stocks have rallied since the election of Donald Trump as president as investors bet on sectors likely to benefit from potential fiscal stimulus. On Friday, stocks ended mixed, but recorded hefty weekly gains. The S&P 500 closed 3.04 points, or 0.1%, lower at 2,164.44 and booked a 3.8% weekly gain, the largest since October 2014. The Dow Jones Industrial Average gained 39.78 points, or 0.2%, to 18,847.66, and gained 5.4% over the week. The Nasdaq Composite ended the session up 28.32 points, or 0.5%, at 5,237.11 and ended the week 3.8% higher. The Russell 2000 outperformed large-cap stocks, rallying 29.23 points, or 2.3% to 1,280.84 to end at a 12-month high. The index of small-cap stocks booked a 10% weekly gain, the best weekly gains since December 2011.

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President-elect Donald Trump told the Wall Street Journal on Friday that he would consider keeping some parts of the Affordable Care Act, specifically the guarantee of coverage for those with pre-existing conditions and allowing young adults to remain on parents’ plans through age 26, which he said he likes “very much.” Trump, who repeatedly said on the campaign trail that he would “repeal and replace” the ACA, said the change of heart dated back to suggestions made by President Barack Obama at their Thursday meeting. “I told him I will look at his suggestions, and out of respect, I will do that,” Trump told the WSJ. “Either Obamacare will be amended, or repealed and replaced.” Other policies Trump told the WSJ he plans to focus on early in his new office include less regulation discouraging bank lending, illegal immigration and preventing drug trade across the border. He also mentioned tax reform when speaking with the WSJ, and did not discuss any plans with the Journal to investigate former presidential rival Hillary Clinton.

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