​Mid-Afternoon Market Update: Avanir Jumps On Otsuka Deal; Mattress Firm Shares Decline

Toward the end of trading Tuesday, the Dow traded up 0.50 percent to 17,865.52 while the NASDAQ surged 0.46 percent to 4,749.16. The S&P also rose, gaining 0.57 percent to 2,065.11.

Leading and Lagging Sectors

On Tuesday, the energy sector proved to be a source of strength for the market. Leading the sector was strength from Callon Petroleum Company CPE and EV Energy Partners LP EVEP.

In trading on Tuesday, telecommunications services shares were relative laggards, down on the day by about 0.35 percent. Meanwhile, top losers in the sector included RRSat Global Communications Network RRST, down 5.2 percent, and ARC Group Worldwide ARCW, off 4.3 percent.

Top Headline

General Motors GM reported a 6.5% y/y rise in its US auto sales in November.

The company delivered 225,818 vehicles in the US in November. Analysts were expecting sales to rise around 3% in the month. Retail sales increased 5%, while fleet deliveries rose 11%.

Equities Trading UP

Spansion CODE shares shot up 23.06 percent to $28.12 after Cypress Semiconductor CY announced its plans to buy Spansion for $1.59 billion in stock.

Shares of Avanir Pharmaceuticals AVNR got a boost, shooting up 12.87 percent to $16.93 after the company agreed to be acquired by Otsuka Pharmaceutical for $17.00 per share in cash.

Cypress Semiconductor CY shares were also up, gaining 15.82 percent to $12.08 after the company announced its plans to buy Spansion CODE for $1.59 billion in stock. Analysts at Topeka Capital upgraded Cypress from Hold to Buy and raised the price target from $10.50 to $13.

Equities Trading DOWN

Vince Holding VNCE shares tumbled 17.45 percent to $30.15.Vince reported better-than-expected earnings for the third quarter.

Shares of Quidel QDEL were down 9.84 percent to $24.70 after the company announced a proposed offering of $150 million of convertible senior notes due 2020.

Mattress Firm Holding MFRM was down, falling 7.33 percent to $64.52. Mattress Firm reported in-line earnings for the third fiscal quarter. However, the company posted upbeat quarterly revenue.

Commodities

In commodity news, oil traded down 1.52 percent to $67.95, while gold traded down 1.59 percent to $1,198.70.

Silver traded down 1.45 percent Tuesday to $16.45, while copper fell 0.22 percent to $2.89.

Euro zone

European shares were mostly higher today. The eurozone’s STOXX 600 rose 0.50 percent, the Spanish Ibex Index gained 0.72 percent, while Italy’s FTSE MIB Index climbed 0.48 percent. Meanwhile, the German DAX declined 0.30 percent and the French CAC 40 jumped 0.25 percent while UK shares rose 1.29 percent.

Economics

The ICSC-Goldman Store Sales Index declined 1.8% in the week ended Saturday versus the earlier week.

The Johnson Redbook Retail Sales Index slipped 0.6% in the four weeks of November versus October.

US construction spending rose 1.10% in October, versus economists’ expectations for a 0.60% gain.