Wall Street falls after strong week; Pfizer and Allergan drag

Mon Nov 23, 2015 4:45pm EST
 
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By Sinead Carew

(Reuters) - U.S. stock indexes closed slightly lower in a quiet trading day on Wall Street after last week's strong gains, while a big healthcare deal failed to impress investors on Monday.

Pfizer's (PFE.N: Quote) announcement of what is expected to be the biggest-ever healthcare deal pushed its shares down 2.6 percent making it one of the biggest drags on the S&P. Target company Allergan (AGN.N: Quote) closed 3.4-percent lower after the $160 billion deal announcement.

"Today was a dull day unless you're involved in Pfizer or Allergan. Away from that, it's kind of aimless," said Brian Fenske, head of sales trading at ITG in New York. "Nobody was panicking when the market was going lower. It wasn't really on heavy volume."

The Dow Jones industrial average .DJI fell 31.13 points, or 0.17 percent, to 17,792.68, the S&P 500 .SPX lost 2.58 points, or 0.12 percent, to 2,086.59 and the Nasdaq Composite .IXIC dropped 2.44 points, or 0.05 percent, to 5,102.48.

Disappointment in the Pfizer/ Allergan deal was driven by weaker-than-hoped-for projected savings from the complex deal, antitrust issues, along with a possible delay in Pfizer's plan to split into two companies, according to analysts.

A few days ahead of the U.S. Thanksgiving holiday, when markets are closed and traders take time off, about 6.18 billion shares changed hands on U.S. exchanges, below the 7.2 billion average for the 20 sessions, according to Reuters data.

After a week when the S&P 500 had its best performance of the year, investors were unimpressed by Monday's economic data and some were concerned that economic growth may be slower than expected, said Stephen Massocca, Chief Investment Officer of Wedbush Equity Management LLC in San Francisco.

"We had a very large rally last week and it's not surprising to see the market correct after that," said Massocca.   Continued...

 
Traders work on the floor of the New York Stock Exchange, November 16, 2015. REUTERS/Brendan McDermid