May 20, 2014 / 3:43 PM / 4 years ago

MARKET PULSE-Aeroflex, Staples, Home Depot, Chimerix, Dow Chemical

(For more market insights, including options activity, click on ; for the Day Ahead newsletter; for the Morning News Call newsletter, U.S. stocks dipped on Tuesday, weighed down by retailers after earnings from TJX Companies and Staples. The Dow Jones industrial average was down 0.27 percent at 16,466.46, the S&P 500 was down 0.21 percent at 1,881.07 and the Nasdaq Composite was down 0.49 percent at 4,106.77.

** AEROFLEX HOLDING CORP, $10.45, +25.75 pct

British aerospace and defense supplier Cobham is buying U.S. communications equipment maker Aeroflex Holding Corp for $1.46 billion, continuing its quest for more commercial customers as its main defense clients cut spending.

** STAPLES INC, $11.78, -12.02 pct

The largest U.S. office supply retailer forecast a fall in sales in the current quarter as customers shift to e-retailers, mass merchants and drugstores to buy their office supplies.

** HOME DEPOT INC, $78.15, +2.16 pct

The world’s largest home improvement chain said its sales were “robust” in May and that it expected to realize in the current quarter most of the sales lost in the first quarter due to a severe winter in the United States.

** INTERCEPT PHARMA, $243.85, -6.21 pct

An article on alleged that the drugmaker had intentionally downplayed the side effects of its liver disease drug in a mid-stage trial that it stopped in January citing highly positive data. (

At the time, Intercept’s stock had quadrupled to a life high of $305.

** CLOVIS ONCOLOGY, $59.17, +4.23 pct

The drug developer said the U.S. Food and Drug Administration had granted breakthrough therapy status to its experimental lung cancer drug.

Breakthrough therapy status is granted to drugs that aim to treat serious diseases based on initial data and can help to expedite the development and review process. Clovis said it was preparing to submit a U.S. marketing application for the drug by mid-2015.

** ENDOCYTE INC, $6.1883, -4.65 pct

Merck & Co Inc and Endocyte said on Monday that they had withdrawn conditional marketing authorization applications from the European health regulator for their experimental advanced ovarian cancer treatment.

The decision follows a recommendation from an independent safety committee that said a mid-stage study testing the drug, vintafolide, in combination with a chemotherapy agent, should be stopped, as the pre-specified criteria for improving survival in patients without their cancer worsening was not met. Study enrollment was suspended earlier this month, the companies said.

** CHIMERIX INC, $15.1, -10.23 pct

The drug developer said on Monday that it was offering 6.2 million shares of its common stock and would use a part of the proceeds from the sale on research and development.

** DOW CHEMICAL CO, $50.15, +1.64 pct

Analysts at Wells Fargo Securities upgraded their rating on the U.S. chemical maker’s stock to “outperform” from “market perform”, as they expect gains next year from the ethylene plant the company is building in Freeport, Texas and from Sadara Chemical Co, a joint venture between Saudi Arabian Oil Co. and Dow Chemical.

** DENDREON CORP, $2.4299, +13.55 pct

The biotechnology company said data from two studies of its cancer vaccine, Provenge, showed that the treatment evoked an immune response associated with an overall survival benefit in patients with advanced prostrate cancer. Dendreon said on Tuesday that the results would be presented during the 2014 American Urological Association (AUA) Annual Meeting in Florida.

** SESA STERLITE LTD, $16.43, +5.25 pct

The Indian mining company’s shares continued to rise on hopes tied to the incoming government led by Narendra Modi. The company’s shares rose 7.9 percent on India’s National Stock Exchange on Tuesday.

** COMMUNITY HEALTH SYSTEMS INC, $37.68, +1.67 pct

Analysts at BofA Merrill Lynch added the hospital operator’s stock to the brokerage’s U.S. 1 list, saying it would significantly outperform over the next 12 months as patient volumes and benefits from healthcare reforms picked up.

“We are bullish on reform benefits for hospitals over the next 2-3 years as we believe that the increased coverage of the uninsured should result in a significantly larger reduction in bad debt than the market is forecasting,” the analysts wrote in a note to clients.

** DICK’S SPORTING GOODS INC, $44.32, -16.63 pct

** CABELA’S INC, $61.49, -4.65 pct

** CALLAWAY GOLF CO, $7.8, -6.59 pct


The athletic apparel and footwear retailer estimated current-quarter earnings way below analysts’ average estimate and cut its full-year 2014 adjusted earnings and same-store sales growth forecasts due to weak demand for its golf and hunting products.

Shares of Dick’s Sporting Goods’ rivals were also down on the news.

** E-HOUSE CHINA HOLDINGS LTD, $9.34, +14.18 pct

The China-based real-estate services company reported better-than-expected first-quarter results, as revenue from its larger real-estate online services business almost doubled.

** CARNIVAL CORP & PLC, $39.35, +1.31 pct

Morgan Stanley raised its rating of the cruise operator’s stock to “equal weight” from “underweight”, citing the company’s “excellent” cost controls.

** TJX Cos Inc, $54.25, -7.11 pct

TJX Cos Inc, the owner of off-price chains TJ Maxx and Marshalls, reported lower-than-expected quarterly revenue as sales of discretionary items such as apparel and home goods were weaker than expected.

** GRAPHIC PACKAGING HOLDING CO, $10.46, -2.15 pct

The packaging company said some of its stockholders would sell about 43.7 million shares of its common stock in a secondary public offering. The company said it would not sell any shares or receive any proceeds from the offering and added that its total number of outstanding shares would not change.


The drug developer filed for a mixed shelf offering to raise gross proceeds of up to $150 million.

** VODAFONE GROUP PLC, $34.4335, -5.17 pct

Britain’s Vodafone said next year’s earnings would be hit by vital investment in its network, as it reported a 6.6 billion pound ($11.1 billion) dent to its 2014 results from writing down the value of European operations struggling in a tough market.

($1 = 0.5943 British Pounds)

** RED ROBIN GOURMET BURGERS INC, $71.54, +12.04 pct

The restaurant chain reported better-than-expected first-quarter results, helped by demand for its new “Finest” line of gourmet burgers and higher restaurant-level margins.

** PERFECT WORLD CO LTD, $16.94, -7.63 pct

China-based online game developer Perfect World reported lower first-quarter revenue compared with the previous quarter, hurt by lower revenue from licensing and online game operations.

Brokerage Pacific Crest cuts its price target on the company’s stock to $24 from $28.

** J C PENNEY INC, $9.06, -3.21 pct

Wells Fargo Securities cut its rating on the department store operator’s stock to “underperform” from “market perform”, as it believes the retailer’s high level of debt likely leaves “very little value” for shareholders.

** OPHTHOTECH CORP, $38.52, +22.44 pct

** NOVARTIS AG, $89.06, -0.51 pct

Ophthotech Corp said it could potentially receive over $1 billion in payments as part of a licensing deal for its experimental eye drug with Novartis AG.


** ALLERGAN INC, $162.33, +1.65 pct

Canada’s Valeant Pharmaceuticals International Inc said it will not make an all-cash bid for drugmaker Allergan Inc as many had expected last week when the company said it would improve its cash and stock offer for the Botox maker.

** PFIZER INC, $29.39, +0.38 pct

** ASTRAZENECA PLC, $72.46, +2.58 pct

AstraZeneca’s twelfth largest shareholder Schroders has joined a chorus of investor disapproval over its rejection of a takeover offer by Pfizer and urged it back into talks.

** URBAN OUTFITTERS INC, $33.6099, -7.08 pct


The teen apparel retailer reported a lower-than-expected quarterly profit as costs jumped and tough competition forced it to spend more on marketing.

Shares of rival American Eagle also fell after Urban Outfitters posted results.

** MEDTRONIC INC, $59.4, -1.56 pct

** EDWARDS LIFESCIENCES CORP, $85.45, -1.19 pct

Medtronic said it had agreed to pay royalties to its rival medical device maker in a settlement that allows Medtronic to continue to sell its CoreValve replacement heart valves. (Compiled by Ankit Ajmera in Bangalore; Editing by Simon Jennings)

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