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Stocks rise as banks climb before Federal Reserve meeting

Traders work on the floor at the opening

Traders work on the floor at the opening bell of the New York Stock Exchange on Wall Street on Friday, Sept. 16, 2016. Credit: EPA / Justin Lane

U.S. stocks are mixed in afternoon trading Monday. Banks are higher as investors wait for the Federal Reserve to meet this week, while health care and technology companies take small losses.

KEEPING SCORE: The Dow Jones industrial average rose 35 points, or 0.2 percent, to 18,158 as of 2:30 p.m. Monday on Wall Street. The Standard & Poor’s 500 index picked up 4 points, or 0.2 percent, to 2,143. The Nasdaq composite lost 2 points to 5,242.

The Federal Reserve will meet Tuesday and announce its latest decision on interest rates the following day. Banks got a boost as some investors hoped that interest rates will rise, which would allow banks to make more money from lending. JPMorgan Chase rose 46 cents to $66.28 and Bank of America rose 14 cents to $15.64.

JACKPOT: Isle of Capri Casinos agreed to be bought by Eldorado Resorts for $23 per share, or $950 million in cash and stock. Combined, the companies own 21 casinos and racetracks. Isle of Capri stock jumped $5.11, or 30.2 percent, to $22.04 while Eldorado Resorts stock lost 35 cents, or 2.5 percent, to $13.90.

SAREPTA SURGING: Sarepta Therapeutics soared $26.29, or 93.4 percent, to $54.44 after the Food and Drug Administration granted tentative approval to its drug Exondys 51, a treatment for a type of muscular dystrophy. The drug treats Duchenne muscular dystrophy, a rare and deadly inherited disease that causes muscle weakness and eventually the loss of all basic movement. It usually causes death by age 25.

The FDA had hesitated to approve the drug because advisers said there was little evidence it worked. Its approval is based on a study of only 12 patients, and the FDA is ordering Sarepta to run a larger study.

TECH DEALS: Information technology products distributor Tech Data jumped after it said it will buy the technology solutions business of Avnet for $2.6 billion in cash and stock. Tech Data says the deal will give it operations in 35 countries. Its stock rose $14.43, or 20.8 percent, to $83.77 and Avnet gained $2.72, or 6.9 percent, to $41.93.

Meanwhile, network control company Infoblox agreed to be bought by Vista Equity Partners for $26.50 per share, or $1.51 billion. It surged $3.46, or 15.2 percent, to $26.29.

POWERED DOWN: Despite those moves, technology companies gave up an early gain to trade lower at midday. Apple, which surged last week and reached its highest price this year, lost $1.05 to $113.87 and Intel fell 39 cents, or 1 percent, to $37.28.

Health care stocks also lagged the market. Merck fell 80 cents, or 1.3 percent, to $61.48 after rival Sanofi said it sued Merck and accused it of infringing on patents protection Sanofi’s insulin drug Lantus. Eye drugmaker Regeneron Pharmaceuticals fell $4.53, or 1.1 percent, to $404.10.

FOCUSED: Johnson & Johnson agreed to buy Abbott Laboratories’ eye health business Friday for around $4.3 billion in cash. Abbott Medical Optics makes lasers and other equipment used for cataract surgeries and laser vision correction procedures as well as eye drops and cleaners for contact lenses. Abbott stock lost 9 cents to $41.78 and Johnson & Johnson gave up 19 cents to $118.06.

SICK DAY: Health website operator WebMD slumped after it said CEO David Schlanger is leaving the company by mutual agreement. Schlanger is being replaced by President Steven Zatz, who is in charge of WebMD’s advertising and sponsorship business. WebMD fell $3.31, or 6.4 percent, to $48.66 and it is down 27 percent since May 25.

STEP ON THE GAS: General Motors gained 80 cents, or 2.6 percent, to $31.77 after an analyst said auto sales, which are at record highs, should remain strong for several years. Analyst Adam Jonas of Morgan Stanley raised his rating on GM to “Overweight” and raised his price target to $37 a share from $29.

OIL: Benchmark U.S. crude added 30 cents to $43.33 a barrel in New York. Brent crude, used to price international oils, rose 27 cents to $46.04 a barrel in London.

METALS: Gold rose $7.60 to $1,317.80 an ounce. Silver added 43 cents, or 2.3 percent, to $19.29 an ounce. Copper remained at $2.16 a pound.

BONDS, CURRENCIES: U.S. government bond prices didn’t move much. The yield on the 10-year U.S. Treasury note held steady at 1.69 percent. The dollar fell to 101.75 yen from 102.42 yen. The euro rose to $1.1175 from $1.1151.

OVERSEAS: The FTSE 100 index of leading British shares climbed 1.5 percent and the CAC-40 in France rose 1.4 percent. Germany’s DAX was 1 percent higher. South Korea’s Kospi added 0.8 percent and Hong Kong’s Hang Seng Index rose 0.9 percent. Trading in Japan was closed for a holiday. Australia’s stock market suspended trading after a couple of hours due to technical glitches. The S & P/ASX 200 finished little changed.


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