Stocks Continue Lower on Merger Monday

Driven by weakness in basic materials and telecommunications, indexes were pulled lower by some of the markets’ largest firms.

Major Averages

• The Dow Jones Industrial Average dropped 42 points, or 0.25 percent, to 17,071.
• The S&P 500 fell 5 points, or 0.25 percent, to 1,978.
• The Nasdaq Composite fell 6 points, or 0.14 percent, to close at 4,506.

Top Stories

Protests by Hong Kong’s residents for semiautonomous control of their government continued. The world is closely watching a reaction from the Chinese government, who said it would not accept dissent.

Some Brazilian companies came under pressure Monday as news was disseminated that the current socialist president, Dilma Rousseff, has a commanding lead over Marina Silva. The most recent data shows Rousseff with 47 percent of the vote and Silva with 43 percent.

Lenovo LNVGY is reported to be close to acquiring IBM’s IBM low end server business. Analysts see Lenovo’s $2.1 billion acquisition helping IBM more than Lenovo, regarding the division as commoditized.

Alibaba BABA CEO Jack Ma made an appearance on 60 Minutes Sunday night following this company’s IPO two weeks ago. Despite sharing his story of starting the company, shares of Alibaba gave up 1.9 percent in Monday's trading.

Stock Movers

Athlon Energy ATHL shares shot up 24.8 percent to $58.32 after Encana ECA announced its plans to buy Athlon Energy for $5.93 billion.

Shares of TIBCO Software TIBX got a boost, shooting up 21.2 percent to $23.65 after the company agreed to be acquired by Vista Equity Partners for $4.3 billion.

DreamWorks Animation SKG DWA shares were also up, gaining 26 percent to $28.18 on rumor of Softbank SFTBY $32.00 per share bid.

Shares of Civeo CVEO were down 49.6 percent to $12.84 after the company issued a weak revenue forecast. The company reported that it will continue as a C Corp and will redomicile to Canada.

Endologix ELGX shares tumbled 18.2 percent to $10.86 after the company lowered its FY14 earnings guidance.

Karyopharm Therapeutics KPTI was down, falling 8.8 percent to $38.38 after the company announced clinical data for Selinexor (KPT-330) in advanced solid tumors.

Commodities

Crude oil shot higher in one of the largest rallies of 2014. Jumping 1.65 percent, crude contracts last exchanged hands at $94.46. The contracts may have trouble climbing above a $95 resistance level.

Precious metals were mostly unchanged on weakness in equity markets. Gold futures are currently trading at a battle ground level, marked by five previous lows and closes. The contracts were last 0.03 percent higher at $1,216.43.

Global Markets

As in the US, investors in Asia closely watched protests in Hong Kong. Hong Kong’s Hang Seng sharply sold off 1.9 percent while the Shanghai index gained 0.43 percent and the Nikkei added 0.5 percent.

European trading began the week on a low note. The Euro Stoxx Index, which tracks 50 blue chips, fell 1.01 percent while London’s FTSE gave up 0.04 percent and France’s CAC lost 0.83 percent.

Currencies

The US Dollar’s massive rally was put on hold Monday. Some speculate that profit taking kicked in. The US Dollar Index was last down 0.08 percent to 85.7225.

As expected with a drop in the dollar, the closely watched EUR/USD pair rose 0.03 percent to $1.2688. The currencies are trading at the lowest level in over a year.