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  • Market Makes Gains On Merger Deals: AIG, MIL, OSIP, INCY, MDVN, BIIB, ONXX, BMRN, HGSI, NFLX, BIDU, ISRG, PCLN, GLD, GOLD, AMZN  0 comments
    Mar 2, 2010 12:27 AM | about stocks: AIG, MIL, OSIP, INCY, MDVN, BIIB, ONXX, BMRN, GSK, NFLX, BIDU, ISRG, PCLN, GLD, GOLD, AMZN

    The market was very strong today, inspired by a few merger/acquisition deals.  This weekend, news reported that AIG was making a deal to sell its Asia-based life insurer AIA Group.  AIG was up +4.08% today.  This afternoon, it was confirmed that the British insurer Prudential PLC will acquire AIG's Asian unit for $35 billion.  In addition, Germany's Merck agreed to buy Millipore Corp. (NYSE:MIL) in an all-cash $6 billion deal.  MIL had already jumped last week on rumors that Thermo Fisher Scientific Inc. (NYSE:TMO) was to be the buyer.  MIL shares moved from $70 to $95 last week.  Today, it hopped another $11% to close at $104.90.

    This morning, OSIP confirmed an unsolicited bid by Japan's Astellas Pharma for $3.5 billion.  OSIP shares soard +52%!!  We have been discussing OSIP's trading actions for over a week (see Sector Watch).  Last night, I mentioned again that OSIP and some other biotech stocks were "brewing their breakout setups."  Apparently, some people already knew about the potential deal and the charts showed it.

    With MIL and OSIP share prices flying high, biotechs led the market as investors scramble to find the next buyout targets.  Among the top gainers were:  INCY +7.88%, MDVN +6.28%, BIIB +3.22%, HGSI +5.93%, ONXX +6.95%, BMRN +3.35%.

    Besides the biotechs, stocks in other sectors were making new all-time highs or new 52-week highs as well.  BIDU recorded a new all-time at $523.25, after trading slightly red in the morning.  NFLX hopped +5.53% to close at $69.7 with a new all-time high at $69.75.  ISRG came close to its all-time to close at $358.63, up $11.49 or +3.31%, a new 52-week high.  PCLN also broke higher, up $11.83, or +5.22%, at $238.54, a new 52-week high.

    After 2 months of weakness, AMZN finally bounced today, up $6.14, or +5.19%.  A report on a new silicon for the chips inside of e-book readers, which may lower the cost for AMZN's Kindle, may have attributed to the buying.  We locked the gains on our AMZN trade:

    March 01, 2010
    12:13 | HappyTrading AMZN ($124.05) Sold to Close 03C120 Mar 120 calls, at $6.15 +32%

    The dollar was very strong this morning.  We exited our trade on GLD for a decent gain:
    07:26 | HappyTrading GLD ($109.30) Sold to Close 03C108 Mar 108 calls, at $2.65 +28% 

    When the dollar slid later in the day, miners started to rally.  Because GLD has not been seeing a lot of momentum, I opted to go with the gold miners, choosing GOLD.  We locked an intraday +31% gain on the trade in about 4 hours; and, we got the day high:

    March 01, 2010
    12:41 | HappyTrading GOLD ($74.20) Sold to Close 03C70 Mar 70 calls, at $5.11 +31%
    08:39 | HappyTrading GOLD ($72.80) Bought to Open 03C70 Mar 70 calls, at $3.90

    The market behaved as forecasted in my Market Forecast article last night, so, we'll look at the charts another day.  Be a little more careful tomorrow as a lot of stocks are getting toppy.  In addition, the Senate may be closing in on a deal on Wall Street regulations.  So, pay attention to the financials.  If the market comes down with momentum, the "high-flyers" mentioned above should see some profit-taking!

    Good night and HappyTrading! ™



    Disclosure: positions: none
    Stocks: AIG, MIL, OSIP, INCY, MDVN, BIIB, ONXX, BMRN, GSK, NFLX, BIDU, ISRG, PCLN, GLD, GOLD, AMZN
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