Mid-Day Market Update: Relypsa Jumps Following Acquisition News; Essendant Shares Drop

Midway through trading Thursday, the Dow traded down 0.16 percent to 18,565.39 while the NASDAQ climbed 0.02 percent to 5,091.08. The S&P also fell, dropping 0.07 percent to 2,171.48.

Leading and Lagging Sectors

On Thursday, basic materials shares climbed by 0.76 percent. Top gainers in the sector included Joy Global Inc. JOY and Endeavour Silver Corp EXK.

In trading on Thursday, industrials shares fell by 0.21 percent. Meanwhile, top losers in the sector included Graco Inc. GGG, down 9 percent, and Southwest Airlines Co LUV, down 9 percent.

Top Headline

General Motors Company GM reported better-than-expected profit for the second quarter and raised its forecast for full.

General Motors projects 2016 adjusted earnings before interest and taxes of $5.50 to $6.00 per share, versus prior forecast of $5.25 to $5.75 per share.

The company’s quarterly net income increased to $2.87 billion, or $1.81 per share, compared to $1.1 billion, or $0.67 per share, in the year-earlier period. Excluding items, GM earned $1.86 per share, beating analysts’ estimates of $1.52 per share.

Equities Trading UP

Relypsa Inc RLYP shares shot up 59 percent to $31.88 after Galenica agreed to acquire Relypsa for $1.53 billion in cash.

Shares of Joy Global Inc. JOY got a boost, shooting up 18 percent to $27.69 after Komatsu Ltd. agreed to acquire the company for around $2.9 billion.

IMAX Corporation (USA) IMAX shares were also up, gaining 14 percent to $34.29. IMAX reported better-than-expected quarterly results.

Equities Trading DOWN

Essendant Inc ESND shares dropped 28 percent to $23.33. Essendant posted Q2 adjusted earnings of $0.55 per share on revenue of $1.35 billion.

Shares of Sunshine Heart Inc SSH were down 21 percent to $1.07 after the company reported an agreement with single investor for offering of convertible preferred stock with proceeds of $3.46 million.

Southwest Airlines Co LUV was down, falling around 9 percent to $38.41 after the company reported weaker-than-expected Q2 earnings and announced plans to buy back $250 million in common stock.

Commodities

In commodity news, oil traded down 0.63 percent to $45.46 while gold traded up 0.24 percent to $1,322.50.

Silver traded down 0.37 percent Thursday to $19.54, while copper rose 0.13 percent to $2.26.

Eurozone

European shares were mostly higher today. The eurozone’s STOXX 600 gained 0.15 percent, the Spanish Ibex Index rose 0.31 percent, while Italy’s FTSE MIB Index rose 0.54 percent. Meanwhile the German DAX rose 0.32 percent, and the French CAC 40 gained 0.11 percent, while U.K. shares fell 0.19 percent.

Economics

U.S. jobless claims declined 1,000 to 253,000 in the latest week. Economists were projecting initial jobless claims to reach 265,000 in the week.

The Philadelphia Fed general conditions index slipped to negative 2.9 in July, versus positive 4.7 in June. However, economists were expecting a reading of 5.

The Chicago Fed National Activity Index rose to 0.16 in June, versus a prior reading of -0.51.

Existing-home sales increased 1.1 percent to an annual rate of 5.57 million in June. However, economists were expecting a 5.48 million rate.

The index of leading indicators rose 0.30 percent in June, versus economists’ expectations for a 0.20 percent growth.

Supplies of natural gas increased 34 billion cubic feet for the week ended July 15, the U.S. Energy Information Administration reported. However, analysts were expecting a gain of 40 billion cubic feet.

Data on money supply for the recent week will be released at 4:30 p.m. ET.