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The Markets
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The Markets
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The Markets
by Proactive
Proactive UK has moved.
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Investments and investor services

US stocks drift lower

Eli Lilly led blue-chips lower after scrapping work on its lead heart drug but news of Ferrari's flotation set petrolheads' pulses racing.

Aside from the news about Dell's bid for EMC, it is looking like a quiet start to the week.

The Dow Jones slipped 11 points lower to 17,073 in the first hour of trading, while the broader-based S&P 500 slipped one point to 2,014 while the tech-infested Nasdaq Composite gave up a couple of points at 4,829.

EMC (NYSE:EMC) initially rose in early trading on Monday after the data storage group agreed to be acquired by US computer giant Dell in a deal valued at about US$67bn.

Shares advanced as much as 3.8% as of 8:27 a.m. in New York before following the market lower, ebbing to US$27.73. The stock had closed up 2.5% at US$27.87 on Friday, giving the company a market value of US$53.6bn.

Dell is offering EMC shareholders about US$24.05 a share in cash and US$9.10 of a tracking stock tied to EMC's VMware (NYSE:VMW) stake, the companies said in joint statement on Monday. EMC bought VMware in 2004 for US$625mln. EMC was left with an 80% stake in VMware when it went public.

On the subject of going public, iconic Italian car producer Ferrari is to be floated by its owner Fiat Chrysler Automobiles (NYSE:FCAU) at a price of between US$48 and US$52.

The indicated flotation range places a value of around US$10bn on Ferrari, and the offering will see Fiat Chrysler pocket around US$1bn.

Shares in Fiat Chrysler were up 1.7% at US$15.94.

Going the other way were shares in Eli Lilly (NYSE:LLY). The drugs giant has ceased development of evacetrapib, its lead heart drug, prompting a 7.3% tumble in the share price to US$79.74.

Also on the slide were shares in social network operator Twitter (NYSE:TWTR). The stock fell just over 5% to US$29.29 on reports it is to lay off staff this week.

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