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US, European stocks dip; Pfizer, Allergan to merge

London's benchmark FTSE 100 index finished the day down 0.5 percent

US and European stocks declined Monday, giving back a fraction of last week's rally as drugmakers Pfizer and Allergan unveiled a mega-merger to open the week. European stocks pulled back, with London penalized as sliding metals and oil prices hurt heavyweight mining and energy companies such as Royal Dutch Shell and Glencore. Equities also dipped in the US, where a $160 billion mega-merger between US pharma giant Pfizer and Ireland-based Allergan failed to spark buying. Ireland-based Allergan dropped 3.4 percent while US-based Pfizer declined 2.6 percent on news they sealed what would be the world's biggest pharma merger and the second biggest merger ever. This week's US economic calendar includes some important data points, such as consumer confidence ahead of the key holiday shopping season. Markets will be closed Thursday for the Thanksgiving holiday. "With the Thanksgiving holiday on Thursday, it will be an abbreviated week of trading and perhaps a week where a number of participants will simply observe from the sidelines. That could create some choppy trading behavior," said Patrick O'Hare of Briefing.com. London's benchmark FTSE 100 index finished the day down 0.5 percent, Frankfurt shed 0.3 percent and Paris gave up 0.4 percent. In the US, the S&P 500 slipped 0.1 percent. Most major indices in Europe and the US last week gained between two and 3.5 percent. - Eurozone lift - Analysts said better eurozone data was unlikely to alter the European Central Bank's easing course when it meets next week. Data monitoring company Markit said its closely watched Composite Purchasing Managers Index rose to 54.4 points from 53.9 points in October, putting it well above the 50-point boom-or-bust line. "While the ECB will undoubtedly take some encouragement and comfort from the improved eurozone purchasing managers' surveys for November, they will unlikely deter the bank from delivering more stimulus in December especially as prices charged continued to fall," said Howard Archer, chief economist on Europe at research group IHS Economics. Craig Erlam, senior analyst at Oanda, said the PMI data "points to slightly stronger growth in the fourth quarter" but added: "I don't think it will dissuade the ECB from easing monetary policy at the meeting next month." Around 2200 GMT, the euro stood at $1.0636, up from a seven-month low of $1.0601 struck during Asian trading hours on Monday, but below its $1.0641 level Friday. For Erlam, the PMI data "failed to ease the pressure" on the single currency. European Central Bank chief Mario Draghi last Friday hinted the lender could unleash further stimulus to boost stubbornly low inflation in the eurozone, comments which helped to drag the single currency to its lowest point since mid-April. Key figures around 2200 GMT New York - Dow: DOWN 0.17 percent at 17,792.68 (close) New York - S&P 500: DOWN 0.12 percent at 2,086.59 (close) New York - Nasdaq: DOWN 0.05 percent at 5,102.48 (close) London - FTSE 100: DOWN 0.5 percent at 6,305.49 points (close) Frankfurt - DAX 30: DOWN 0.3 percent at 11,092.31 (close) Paris - CAC 40: DOWN 0.4 percent at 4,889.12 (close) EURO STOXX 50: DOWN 0.2 percent at 3,445.26 (close) Tokyo - Nikkei 225: CLOSED for national holiday in Japan Euro/dollar: DOWN to $1.0636 from $1.0641 in late US trade on Friday Dollar/yen: DOWN to 122.83 yen from 122.85 yen