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U.S. stocks were little changed on Tuesday, as conflict in the Middle East intensified to push the energy sector higher, offsetting declines in the healthcare space after the U.S. Treasury moved to curb “tax inversion” deals.
The Dow Jones industrial average was down 0.50 percent at 17,086.1, the S&P 500 was down 0.39 percent at 1,986.53.
** ALCO STORES INC, $2.9999, -49.15 pct - top percentage loser on the Nasdaq
The retailer hit an all-time low of $2.81 after posting a second-quarter loss compared to a profit a year earlier. Revenue fell 6 percent hurt by an 8.9 percent decline in same-store sales.
** GALMED PHARMACEUTICALS LTD, $8.7, +34.26 pct - top percentage gainer on the Nasdaq
The U.S. FDA gave fast-track status to the drug developer’s lead drug, which is being tested as treatment for non-alcoholic steato-hepatitis. The drug is expected to be tested in a mid-stage study this year.
** NQ MOBILE INC, $6.49, +12.48 pct
The Chinese mobile security software maker's shares were the largest percentage gainer on the NYSE at midday on a report that the company was seeking an alternative to stay public even as it was evaluating Bison Capital Holding Co's go-private offer worth $9.80 per share. As of Aug. 29, 31.8 pct of the company's shares outstanding shares were sold short. (bit.ly/XUU3XV)
** ASTRAZENECA PLC, $71.31, -4.50 pct
** SHIRE PLC, $250.72, -2.18 pct
** ABBVIE, $57.361, -2.30 pct
** MEDTRONIC, $64, -3.00 pct
** PFIZER, $30.11, -0.23 pct
** COVIDIEN, $88.53, -2.07 pct
** MYLAN, $46.68, +0.32 pct
** BURGER KING WORLDWIDE, $30.39, -2.16 pct
** TIM HORTONS, $79.7, -0.55 pct
Moving against tax avoidance by corporations, the Obama administration took several actions on Monday to curb “inversion” deals that allow companies to escape high U.S. taxes by reincorporating abroad.
“This is a big impact and certainly it will put a cap on a lot of M&A or takeover activity,” IG analyst Brenda Kelly said.
AstraZeneca’s and Shire’s stocks fell after the announcement, while the move could jeopardize an agreed deal for AbbVie to buy Shire for $55 billion and deter Pfizer from making another attempt to acquire AstraZeneca.
Medtronic, meanwhile, is working to close an inversion deal into Ireland with rival Covidien, while Mylan plans to buy certain of Abbott’s drugs in developed markets outside the United States in another tax-cutting transaction.
Fast-food chain Burger King is also in the midst of inverting to Canada in a deal with Tim Hortons.
** ON TRACK INNOVATIONS LTD, $3.13, +7.19 pct
The cashless payment services provider and payment card maker ABNote said they launched “a major NFC mobile electronic payment trial with one of the largest financial institutions in North America”.
The announcement comes in the wake of Apple Inc’s move into mobile payments, which relies on wireless near-field communications (NFC) technology.
** NET ELEMENT INC, $2.78, -6.71 pct
Funds managed by board member and former CEO Mike Zoi sold 2.9 million shares of mobile payment service provider between Sept. 16 and Sept. 22, according to a regulatory filing (bit.ly/1r4U4Wc)
Zoi held 33.8 percent stake in Net Element as of March 31.
** HERBALIFE LTD, $43.54, +8.28 pct
The weight-loss and nutritional products maker’s stock fell as much as 14 percent on Monday on rumors that activist investor Carl Icahn was liquidating his stake.
Fox Business later reported on Monday that Icahn had not sold a stake, citing sources. According to Thomson Reuters data, short interest in Herbalife now stands at 33.9 pct, much higher than the 1.5 pct held in wider U.S. consumer staples stocks.
** CARMAX INC, $48.03, -9.05 pct
The the largest U.S. used-car retailer reported a lower-than-expected quarterly profit as growth in comparable unit sales at its used-car lots slowed to a near halt, hurt by tighter lending norms that kept subprime customers at bay.
** MOBILEYE NV, $52.113, +5.15 pct
CNBC's Jim Cramer mentioned Mobileye as "number one IPO this year" [www.cnbc.com/id/102022295#. ]
The recent fall of driver-assistance system maker’s stock from $56 to $49 was termed as a “buy opportunity” by Cramer.
** BLACKBERRY LTD, $10.435, -4.53 pct
Cormark Securities Inc cut its rating on company’s stock to “market perform” from “buy (speculative)” a day before BlackBerry launching its latest handset, BlackBerry Passport.
Cormark said it expects BlackBerry’s revenue to fall in the second quarter, partly driven by losses from handset unit and views the company’s new operating platform, BES 12 due this year, as the main number driver rather than its handsets.
** NXT-ID INC, $2.84, +33.96 pct
The surge in the stock of the provider of biometric security for mobile phones continued on Tuesday, adding to the 54 percent jump on Monday. The stock had lost about a third of its value through Friday’s close.
The company early on Monday said it recently completed an essential round of funding to support ramping of production of its chief product, Wocket.
** MECHEL OAO, $0.8, -21.57 pct
The Russian steelmaker’s U.S.-listed stock continued their fall on Tuesday after hitting a record-low on Monday following a Russian minister’s comments that bankruptcy was the most likely scenario for the over-indebted company.
“We should probably admit the fact - if a company is bankrupt, it should be legally acknowledged,” Russian Economy Minister Alexei Ulyukayev said of the company which has debts of $8.6 billion.
** CHINA FINANCE ONLINE CO LTD, $8.58, +20.68 pct
The Beijing-based provider of financial information and services entered into strategic partnership with Zhongshan Securities to integrate with its own web-based trading platform, “Securities Master,” or “Zhengquantong,” with Zhongshan Securities’ trading and settlement system.
** ASCENA RETAIL GROUP INC, $13.765, -16.73 pct
At least two brokerages, including Piper Jaffray, cut their price targets on the apparel and accessories retailer. The company reported lower-than-expected quarterly profit and sales, hurt by lower demand for its Justice and Lane Bryant brands.
** CHINANET ONLINE HOLDINGS INC, $2.6315, -17.51 pct
The Chinese advertisement company’s stock pulled back after having surged 213 percent over previous two trading days,hitting three-year high of $3.98 on Monday.
The company said on Friday it was in talks to provide a marketing service for Taobao, the online shopping site owned by Alibaba.
** T2 BIOSYSTEMS INC, $18.825, +11.19 pct
The U.S. FDA allowed the medical device maker to market its first two products, T2Candida panel and T2dx device, used to detect yeast pathogens that cause sepsis. The devices can identify five common yeast pathogens from blood specimen within 3-5 hours, while traditional methods take six days or more.
** DEL FRISCO’S RESTAURANT GROUP INC, $20.015, -7.72 pct
Sterne Agee & Leach analysts downgraded the restaurant chain owner’s stock to “neutral” from “buy”, saying earnings growth for rest of 2014 and into 2015 would be limited by higher cost of beef, weaker performance at some of its restaurants and costs related to store openings.
** MODINE MANUFACTURING CO, $12.75, +4.42 pct
Sidoti & Co upgraded the heat exchangers maker’s stock to “buy” from “neutral”, according to Theflyonthewall.com.
** CARBO CERAMICS INC, $66.97, -5.56 pct
Goldman Sachs on Tuesday again cut its price target on the ceramic proppant supplier’s stock to $54 after slashing it to $71 from $104 on Friday. The company said on Monday that rising price competition and increasing demand for sand were hurting ceramic proppant sales.
** YAMANA GOLD INC, $6.62, +0.91 pct
** ELDORADO GOLD CORP, $7.16, +5.29 pct
** HARMONY GOLD MINING, $2.395, +1.91 pct
** AGNICO EAGLE MINES LTD, $30.77, +2.26 pct
** HECLA MINING CO, $2.758, +4.47 pct
** COEUR MINING INC, $5.89, +5.18 pct
** SILVER STANDARD RESOURCES INC, $6.69, +6.02 pct
** ROYAL GOLD INC, $65.75, +2.64 pct
** RANDGOLD RESOURCES LTD, $71.55, +3.05 pct
Gold prices rose as dollar eases and U.S. air strikes add to global tension and safe-asset demand, sending U.S.-listed stocks of gold and silver miners up.
Spot gold rises 1.4 percent to $1,232.20 an ounce by 1204 GMT after dropping for two straight days and reaching its lowest since Jan 2 on Monday.
Silver rises 0.9 percent to $17.85 an ounce, after slipping to a four-year low of $17.30 on Monday.
** SALIX PHARMACEUTICALS LTD, $168.93, +5.69 pct
** ALLERGAN INC, $169, +1.73 pct
** VALEANT PHARMACEUTICALS INC, $115.97, -0.27 pct
Allergan has revived discussions to buy Salix, but the exact status of the discussions between the two drugmakers could not be immediately established.
The botox maker is trying to seal a deal with Salix in order to fend off a $53 billion hostile offer from Valeant. Salix said in July it would merge with an Irish subsidiary of Cosmo Pharmaceuticals SpA in a so-called tax inversion.
Billionaire William Ackman-backed Pershing Square Capital Management said on Tuesday that it would sue Allergan if it went ahead with a deal to buy Salix.
** CF INDUSTRIES, $270.47, +5.74 pct
Norway’s Yara International is in talks with Chicago-based CF Industries about a possible merger of equals, the firms said, a deal that would create a fertilizer giant with market value over $27 billion.
** PEABODY ENERGY CORP, $13.03, +3.00 pct
The coal miner raised its third-quarter adjusted EBITDA outlook due to cost improvements and “strong” operating results. It also reported higher-than-expected results from the Western United States, improved performance from Australian met coal mines and continued cost reductions.
** PHILIPS, $31.22, +3.58 pct
The 120-year-old Dutch conglomerate said it will split into two, spinning off its lighting business to expand its higher-margin healthcare and consumer division.
It expects to save 100 million euros ($128.8 million) in 2015 and 200 million euros in 2016 from the new structure.
** TEKMIRA PHARMACEUTICALS CORP, $24.295, +2.90 pct
The Canadian drugmaker’s Ebola drug shows promising signs after being administered to doctor infected with virus in West Africa, Nebraska Medical Center said.
The drug, code named TKM-Ebola, was authorized to be used by U.S. and Canadian regulators in patients with confirmed or suspected Ebola infection, and is among several experimental Ebola drugs to be tested in West Africa to fast track trials, global health charity Wellcome Trust said.
** SANGAMO BOISCIENCES INC, $11.26, +4.55 pct
Jefferies & Co analysts started coverage on the drug developer’s stock with a “buy” rating saying positive data on its experimental HIV treatment demonstrated the value of its drug development platform called “zinc finger protein technology”.
** MICRON TECHNOLOGY INC, $31.165, +1.85 pct
Micron is expected to report good results on Thursday driven by strong DRAM pricing trends in the quarter, Pacific Crest Securities analyst, Monika Garg wrote in a note.
“PC DRAM pricing was up slightly in fiscal fourth quarter and NAND pricing also has started to stabilize, which benefits Micron,” Garg said. DRAM is a memory chip used in personal computers, while NAND chips are used in smartphones and tablets.
** GENESIS ENERGY LP, $51.06, -3.70 pct
The pipeline company’s offering of 4 million units was priced at $50.71 each, a 4.4 percent discount to Monday’s closing price. The offering represents about 4.5 percent of total outstanding units as of Aug. 6
** APPLE INC, $102.535, +1.46 pct - second most active stock on the Nasdaq, nearly 4 million shares traded
The iPhone 6 is in the final stages of review for approval, with results due shortly, a top Chinese government regulator said in an interview published by Tencent.
** SPECTRUM BRANDS HOLDINGS INC, $88.77, +0.15 pct
** PROCTER & GAMBLE CO, $84.58, -0.27 pct
P&G said it would sell the last of its pet food business to consumer products company Spectrum Brands as it focuses on more profitable lines such as Tide detergent, Gillette razors and Pampers diapers.
Brokerage CRT Capital raised its price target on Spectrum’s stock to $95 from $92. (Compiled by Shailaja Sharma in Bangalore; Editing by Savio D’Souza)