Pfizer has agreed to acquire Medivation (NASDAQ:MDVN) for $14B, with Pfizer (NYSE:PFE) beating out rivals Celgene (NASDAQ:CELG), Gilead (NASDAQ:GILD), Sanofi (NYSE:SNY), Merck (NYSE:MRK) and AstraZeneca (NYSE:AZN). Medivation makes the leading prostate cancer drug, Xtandi, which is expected to generate $5.7B in annual revenue by 2020.
European shares and U.S. stock futures were lower at the time of writing following a broad drop in Asia overnight. A 0.3% decline in the euro versus the dollar amid speculation about when the Fed will raise interest rates had apparently boosted exporters earlier in Europe. Vice-Chairman Stanley Fischer did nothing to dispel the feeling in a speech yesterday that the Fed will increase rates sooner rather than later as he gave an upbeat assessment about the economy.
The leaders of Germany, France and Italy were due to meet on an island off the coast of Naples today to discuss how to keep the European project together in the second set of talks between the eurozone’s three largest economies since Britain’s vote to leave the EU. Merkel wants to cement “a better Europe” rather than forge ahead with “more Europe,” Renzi wants Italy to have a strong voice in how the bloc’s future is shaped post-Brexit, and Hollande wants an EU-wide investment plan to be doubled.
The Bank of Japan will not rule out deepening a cut to negative rates it introduced in February even though the controversial policy has failed to spur inflation or economic growth. “The degree of negative rates introduced by European central banks is bigger than Japan. Technically there definitely is room for a further cut,” Governor Haruhiko Kuroda told the Sankei newspaper.
India has appointed Urjit Patel as its next central bank chief in a decision that many economists and executives hope is a sign of New Delhi’s commitment to the inflation-fighting policies of departing governor Raghuram Rajan. Patel is currently a deputy governor in charge of monetary policy at the Reserve Bank of India. He has been appointed for three years and will begin his term once Rajan steps down on Sept. 4.
Iraq, OPEC’s second-largest oil producer, plans to boost exports 5%, or 150,000 barrels a day, in the next few days following a deal to restart shipments from three fields in Kirkuk. Exports were suspended in March due to a payment dispute with Kurdistan, which controls the relevant pipeline. The news doesn’t quite square with speculation that OPEC is set for discussions about freezing output. Crude prices were lower at the time of writing.
The Committee on Foreign Investment in the United States, which studies M&As for national security implications, has cleared ChemChina’s $43B acquisition of Swiss pesticides and seeds company Syngenta (NYSE:SYT). In a statement, the firms didn’t mention any concessions required, but they did say they expect to close the deal later this year as they work to receive anti-trust approval from authorities around the world. The transaction is of concern to the U.S. as Syngenta has facilities in North Carolina, and a presence in California, Minnesota and elsewhere. Syngenta shares were +8.3% premarket.
Production at six Volkswagen plants with over 25,000 workers has been hit as a dispute with two suppliers rumbles on. The carmaker was today set to restart talks with CarTrim, which manufactures seats, and ES Automobilguss, which produces cast-iron parts for gearboxes. The suppliers want compensation for what they say are lost revenues worth tens of millions of euros after VW (OTCPK:VLKAF) canceled a contract without explanation.
Japanese semiconductor firm Renesas (OTCPK:RNECF) has confirmed reports that it is in negotiations to acquire U.S.-based Intersil (NASDAQ:ISIL), which produces chips for automotive and aerospace customers. A deal could be valued at around ¥300B ($3B), the reports said, and would represent the latest move in a trend of recent consolidation among global chipmakers.
Zoetis CFO Paul Herendeen has resigned to take up the same position at Valeant (NYSE:VRX). Glenn David, SVP of finance at Zoetis (NYSE:ZTS), will replace Herendeen. Valeant has been shaking up its upper management, naming a new general counsel earlier this month. Herendeen came out of retirement two years ago to join Zoetis. He implemented costs cuts, acquisitions and brushed with Valeant investor Bill Ackman, who took a big stake in Zoetis in 2014.
With Tim Cook set to hit his five-year anniversary as Apple (NASDAQ:AAPL) CEO on Wednesday, analyses abound as to how the company has fared following his replacement of Steve Jobs. On the one hand, Apple’s revenues have grown almost fourfold, net profit hit a whopping $53B last year and its market cap is $590B. However, the nagging feeling that the company’s best days are behind it seems to be growing. Revenue has fallen for two quarters in a row, the iPad has slumped and the Apple Watch is no blockbuster. Ultimately, the question is whether Apple can produce another revolutionary product to match the iPhone.
Uber CEO Travis Kalanick doesn’t support acquiring ride-hailing competitor Lyft (Private:LYFT), Bloomberg reports, due to the regulatory scrutiny a deal would bring. However, if Uber (Private:UBER) were to buy its rival it wouldn’t pay more than $2B, well below the $5.5B that Lyft was valued at in a funding round involving GM earlier this year.
In Asia, Japan +0.3% to 16598. Hong Kong +0.3% to 22998. China -0.5% to 9815. India -0.3% to 27986.
In Europe, at midday, at midday, London -0.5%. Paris -0.2%. Frankfurt -0.3%.
Futures at 7:10, Dow -0.2%. S&P -0.2%. Nasdaq -0.2%. Crude -2.8% to $47.73. Gold -0.5% to $1339.95.
Ten-year Treasury Yield flat at 1.58%
Today’s Economic Calendar
8:30 Chicago Fed National Activity Index
Companies reporting earnings today »