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US stocks modestly lower in early trading; oil prices slide

U.S. stock indexes edged mostly lower in early trading Monday, led by declines in energy companies. Oil and gas companies fell the most as the price of crude oil headed lower. Materials stocks notched the biggest gain. Investors had their eye on the latest company earnings and deal news.

KEEPING SCORE: The Dow Jones industrial average fell 52 points, or 0.3 percent, to 19,910 as of 10:18 a.m. Eastern Time. The Standard & Poor’s 500 index slid 5 points, or 0.3 percent, to 2,271. The Nasdaq composite index rose 2 points, or 0.1 percent, to 5,523.

OIL WOES: Rig operator Transocean slumped 4.4 percent and Southwestern Energy fell 4 percent as the price of oil headed lower. Transocean slipped 55 cents to $54.49, while Southwestern Energy was down 41 cents at $9.84.

DISSAPOINTING RESULTS: Acuity Brands slumped 16 percent after the lighting maker reported quarterly results that fell well short of what analysts were expecting. The stock lost $38.30 to $199.06.

STRONG QUARTER: Electronic payment processing company Global Payments climbed 6.8 percent after it reported better-than-anticipated quarterly results. The stock added $5.08 to $79.53.

SOLD: Surgical Care Affiliates surged 15.9 percent after the surgical care center operator agreed to be acquired by UnitedHealth for $2.3 billion in cash and stocks. The deal comes as UnitedHealth, the nation’s biggest health insurer, looks to expand its Optum health business. Shares in Surgical Care Affiliates added $7.74 to $56.49. UnitedHealth slipped $1.12, or 0.7 percent, to $161.29.

PHARMA DEAL: Merrimack Pharmaceuticals jumped 12.5 percent on news the drugmaker is selling its first approved drug, a pancreatic cancer treatment called Onivyde, to French drugmaker Ipsen in a deal worth at least $575 million. Merrimack gained 45 cents to $4.05.

PET PLAY: VCA vaulted 28.1 percent after the pet health care company agreed to be acquired by food and drinks company Mars Inc. for around $7.7 billion. The deal also includes $1.4 billion in debt. Shares in VCA added $19.92 to $90.68.

ENERGY: U.S. benchmark crude oil was down $1.27, or 2.4 percent, at $52.72 a barrel in New York. Brent crude, which is used to price oil sold internationally, was down $1.36, or 2.4 percent, at $55.74 a barrel in London.

MARKETS OVERSEAS: In Europe, Germany’s DAX was down 0.5 percent, while France’s CAC 40 was 0.7 percent lower. Britain’s FTSE 100 was up 0.4 percent. Indexes in Asia were mixed. Hong Kong’s benchmark Hang Seng index rose 0.3 percent, while South Korea’s Kospi slipped 0.1 percent. Markets in Japan were closed for a holiday.

BONDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.3Y percent from 2.42 percent late Friday.

CURRENCIES: The pound fell to $1.2133 from $1.2408, its lowest level since October, amid indications the British government is inclined to opt for a full break away from the European Union’s single market. The dollar fell to 116.31 yen from 117.02 yen in late trading Friday. The euro weakened to $1.0534 from $1.0532.


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