Market Overview

Mid-Morning Market Update: Markets Edge Lower; Centene To Buy Health Insurer Rival WellCare


Following the market opening Wednesday, the Dow traded down 0.02 percent to 25,653.50 while the NASDAQ declined 0.18 percent to 7,677.36. The S&P also fell, dropping 0.07 percent to 2,816.41.

Leading and Lagging Sectors

Wednesday morning, the industrial shares climbed 0.3 percent. Meanwhile, top gainers in the sector included UniFirst Corporation (NYSE: UNF) up 7 percent, and China Southern Airlines Company Limited (NYSE: ZNH) up 4 percent.

In trading on Wednesday, energy shares fell 0.4 percent.

Top Headline

Health insurer Centene Corp (NYSE: CNC) said Wednesday it reached an agreement to acquire WellCare Health Plans, Inc. (NYSE: WCG), a provider of government-sponsored managed care services, for more than $15 billion.

The combination of St. Louis-based Centene and Tampa-based WellCare will create a new health care enterprise company that will be a leader in Medicaid, Medicare and the Health Insurance Marketplace, the companies said in a press release.

WellCare investors will receive a fixed exchange ratio of 3.38 shares of Centene stock in addition to $120 in cash for each share of WellCare owned. At a per-share value of $305.39 based on WellCare's Monday closing price, the companies said this deal implies a total enterprise value of $17.3 billion.


Equities Trading UP

Syndax Pharmaceuticals, Inc. (NASDAQ: SNDX) shares got a boost, shooting up 24 percent to $5.68 after the company reported a $26.2 million offering of common stock and warrants.

Shares of Shoe Carnival, Inc. (NASDAQ: SCVL) shot up 19 percent to $36.13 after the company reported stronger-than-expected results for its fourth quarter.

WellCare Health Plans, Inc. (NYSE: WCG) shares were also up, gaining 10 percent to $254.24 after Centene Corp (NYSE: CNC) said Wednesday it reached an agreement to acquire WellCare for more than $15 billion.


Equities Trading DOWN

CounterPath Corporation (NASDAQ: CPAH) shares dropped 19 percent to $2.20 following an increase in price Tuesday which seemed to be motivated by recirculation of a press release originally published in January.

Shares of Fibrocell Science, Inc. (NASDAQ: FCSC) were down 16 percent to $2.09 after the company reported feedback from Type B end-of-Phase 2 meeting with the FDA on Phase 3 trial design for FCX-007.

At Home Group Inc. (NYSE: HOME) was down, falling around 21 percent to $18.09 after the company reported worse-than-expected Q4 EPS and announced 2020 guidance at the low end of analyst expectations.


In commodity news, oil traded down 0.1 percent to $59.93 while gold traded down 0.1 percent to $1,320.90.

Silver traded down 0.3 percent Wednesday to $15.38, while copper rose 0.3 percent to $2.862.



European shares were mostly higher today. The eurozone’s STOXX 600 surged 0.4 percent, the Spanish Ibex Index rose 1.2 percent, while Italy’s FTSE MIB Index rose 1 percent. Meanwhile the German DAX climbed 0.4 percent, and the French CAC 40 climbed 0.4 percent while U.K. shares fell 0.1 percent.


The U.S. trade deficit fell 15 percent to $51.1 billion in January, versus a revised $59.9 billion in December.

The U.S. current-account deficit increased 6.2 percent to $134.4 billion in the fourth quarter, versus a revised $126.6 billion in the third quarter.

The Energy Information Administration’s weekly report on petroleum inventories in the U.S. is schedule for release at 10:30 a.m. ET.

The Treasury is set to auction 5-year notes at 1:00 p.m. ET.

Kansas City Federal Reserve Bank President Esther George is set to speak in New York at 7:00 p.m. ET.


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