On The Fly: Top stock stories at midday
U.S. stocks are continuing the decline seen at the end of last week following the short-lived Fed-fueled rally, with today's weakness exacerbated by the slide in bank stocks in the U.S. and Europe. Of note, Deutsche Bank (DB) shares have slid to all-time lows after Germany's Angela Merkel ruled out government assistance for the beleaguered bank, though the bank responded that it was not seeking any help from the Chancellor. ECONOMIC NEWS: In the U.S., new home sales dropped 7.6% to 609,000 unit rate in August, which was better than the 8.3% month-over-month decline in the new home sales rate that was expected. In Asia, Bank of Japan Governor Haruhiko Kuroda suggested in a speech that the Japanese central bank was prepared to push rates deeper into negative territory if needed to help meet its inflation target. COMPANY NEWS: Shares of Deutsche Bank trading in New York have dropped 7% near noon amid worries about its capital position after German Chancellor Angela Merkel ruled out government aid for the bank. The German bank, which faces a potential fine of as much as $14B in the U.S. over mortgage-securities investigations stemming from the 2008 financial crisis, denied that the company ever asked Merkel to intervene in the bank's dispute with the Justice Department, adding that a government bailout is "not on our agenda"... Pfizer (PFE) announced that, after an extensive evaluation, the company's Board of Directors and executive leadership team have determined the company will not pursue splitting Pfizer Innovative Health and Pfizer Essential Health into two, separate publicly traded companies at this time... After jumping on Friday amid takeover speculation, shares of Twitter (TWTR) are giving back some of those gains after Oppenheimer analyst Jason Helfstein downgraded the stock to Underperform, saying that a media company is the most likely acquirer of Twitter and would not pay meaningfully more than the valuation implied by his $17 price target on the stock. MAJOR MOVERS: Among the notable gainers was Array Biopharma (ARRY), which has advanced over 60% after a Phase 3 study evaluating a combo treatment in patients with BRAF-mutant advanced, unresectable or metastatic melanoma met its primary endpoint. Also higher was Chemtura (CHMT), which gained about 16% after agreeing to accept Lanxess' offer to buy the company for $33.50 per share. Among the noteworthy losers was Lands' End (LE), which dropped 15% after the company announced that its CEO will step down after less than two years in the position as the retailer looks to restore sales growth. Also lower was Carnival (CCL), which slipped about 2% despite posting top and bottom line beats for its latest quarter and raising its full year guidance. INDEXES: Near midday, the Dow was down 146.83, or 0.8%, to 18,114.62, the Nasdaq was down 42.04, or 0.79%, to 5,263.71, and the S&P 500 was down 15.14, or 0.7%, to 2,149.55.