Mid-Morning Market Update: Markets Drop; Horizon Pharma Proposes To Buy Depomed for $29.25/Share

Following the market opening Tuesday, the Dow traded down 0.60 percent to 17,577.85 while the NASDAQ slipped 0.94 percent to 4,945.05. The S&P also fell, dropping 0.56 percent to 2,057.17.

Leading and Lagging Sectors

Utilities shares climbed by 0.49 percent on Tuesday. Meanwhile, top gainers in the sector included Southern Co SO, up 2 percent, and Duke Energy Corp DUK, up 2 percent.

In trading on Tuesday, basic materials shares dipped by 2.71 percent. Meanwhile, top losers in the sector included Yanzhou Coal Mining Co Ltd (ADR) YZC, down 11 percent, and Rex Energy Corporation REXX, off 11 percent.

Top Headline

Horizon Pharma PLC HZNP proposed to buy Depomed Inc DEPOfor $1.75 billion in an all stock transaction.

The offer price of $29.25 per share represents a 42 percent premium over Depomed’s closing price on July 6, 2015.

Equities Trading UP

Depomed Inc DEPO shares shot up 38 percent to $28.48 after Horizon Pharma PLC HZNP proposed to acquire DepoMed for $29.25 per share in stock.

Shares of Plug Power Inc PLUG got a boost, shooting up 13 percent to $2.51 after the company reaffirmed its FY15 financial targets.

Himax Technologies, Inc. (ADR) HIMX shares were also up, gaining 7 percent to $8.33. Chardan Capital upgraded Himax Technologies from Sell to Buy and raised the price target from $4.00 to $13.00.

Equities Trading DOWN

Advanced Micro Devices, Inc. AMD shares tumbled 15 percent to $2.09 after the company lowered its revenue forecast for the second quarter.

Shares of A Schulman Inc SHLM were down 12 percent to $37.07 after the company reported downbeat third-quarter results and lowered its outlook for the year.

Cardtronics, Inc. CATM was down, falling 10 percent to $33.00 after the company announced the notification of non-renewal of 7-Eleven agreement upon expiration in mid-2017.

Commodities

In commodity news, oil traded down 1.56 percent to $51.71, while gold traded down 1.53 percent to $1,155.30.

Silver traded down 4.56 percent Tuesday to $15.04, while copper fell 4.06 percent to $2.44.

Eurozone

European shares were lower today. The eurozone’s STOXX 600 fell 0.31 percent, the Spanish Ibex Index dropped 0.91 percent, while Italy’s FTSE MIB Index declined 0.61 percent. Meanwhile, the German DAX dropped 0.77 percent, and the French CAC 40 dipped 1.01 percent while UK shares slipped 0.36 percent.

Economics

US trade deficit increased 2.9 percent to $41.9 billion in May, versus a revised $40.7 billion in April. However, economists were expecting a deficit of $42.1 billion. Exports slipped 0.8 percent to $188.6 billion, while imports declined 0.1 percent to $230.5 billion.

Data on consumer credit for May will be released at 3:00 p.m. ET.