For U.S. stock market report double-click [.N] 0857 ET 02June2009-Glaxo ADRs fall after signing drug deal
U.S.-listed shares of GlaxoSmithKline (GSK.N) fell in premarket trading on Tuesday after the pharmaceutical company signed a potential $1 billion deal with privately-held U.S. biotech company Concert Pharmaceuticals to access deuterium-containing medicines.
In the deal, Glaxo gets rights to three Concert research programs -- a protease inhibitor for HIV due to start Phase I clinical trials this year, a preclinical drug for chronic kidney disease and a third, unspecified product.
Glaxo shares slid 1.8 percent to $33.58 before the bell on the New York Stock Exchange.
U.S. Treasury Secretary Timothy Geithner on Tuesday said that improving confidence in the economy may lessen banks' interest in government-designed programs to reduce toxic assets from bank balance sheets.
Because banks are raising unexpectedly large amounts of capital from private investors, they may be able to sell more of their impaired assets in the market, Geithner told CNBC during a visit to Beijing.
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GFT on Tuesday wrote that "the fundamental weakness" of the global economy hadn't gone away, despite a recent rally in the stock market.
"So far, those of us calling this a bear market rally have had our expectations confounded. The surge in stocks has been impressive and feels like it could continue - although we would expect to see some consolidation soon," the firm wrote.
GFT expects a lower open for the markets on Tuesday, with the Dow Jones industrial average .DJI opening down 50 points while the S&P 500 .SPX opens down 6 points.
"The imbalances that contributed to the crisis have not been addressed, and unemployment continues to rise. We can't expect a return to equity levels seen six months ago, but the question now is: what is fair value going forward?," it wrote.
SunTrust Banks Inc (STI.N) said Monday it plans to sell $1.4 billion of common stock, raise $300 million of common equity from selling securities, and raise $250 million of common equity from buying back up to $1 billion of preferred and hybrid securities for cash.The U.S. Southeast regional bank, ordered by federal regulators to raise $2.2 billion of equity capital, priced its offering of 108 million shares at $13 per share, below Monday's closing price of $13.80.
Shares of the Atlanta-based bank were down 1.3 percent to $13.62 in premarket trading.
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Jefferies on Tuesday trimmed its estimates on American Express (AXP.N), a day after the credit card company announced a $500 million follow-on equity issuance. The offering was done to help the company repay TARP funds.
The firm lowered its 2009 earnings estimate on the company by 1 cent a share to $1.17 a share. The 2010 view was cut to $1.47 a share from $1.49 a share.
Jefferies said that the offering didn't change its view on the stock but reaffirmed its underperform rating, arguing that "the current forward price-to-earnings multiple of 20 (times) is too rich considering regulatory pressures and dramatic declines in credit card spending volumes."
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