Shares of Bristol-Myers Squibb Co. dropped 1.8% in morning trade Monday, after disappointing trial results announced last week prompted Credit Suisse to downgrade the drug giant. Analyst Vamil Divan cut his rating to neutral, after being at outperform since at least October 2013. The stock had plunged 16% on Friday, the second-biggest one-day loss since it went public in January 1972, after a late-stage trial of its lung cancer treatment surprisingly failed to meet its primary endpoint. “While we are not fans of reacting to news, Friday’s developments are too significant and surprising for us to maintain our bullish stance on [Bristol-Myers],” Divan wrote in a note to clients. Divan also upgraded Merck & Co. to outperform after being at neutral since June 2014. Merck’s stock, which lost 2.2% in morning trade, had soared 10% on Friday, the fifth-biggest gain in its history, as investors saw Bristol-Myers’ drug failure as a boon for Merck’s rival drug. Year to date, shares of Bristol-Myers has lost 9.6%, Merck has rallied 18%, the SPDR Health Care Select Sector ETF has gained 3.9% and the Dow Jones Industrial Average has climbed 6.4%.
Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.
From:: Stock Market News