Dow Now: Merck to Pull Ineffective Cholesterol Drug

By Christopher Witrak  JAN 11, 2013 1:38 PM

Chevron and Merck are up today.


After helping markets yesterday, China has weighed on stocks today. China’s inflation increased to a seven-month high because of higher food costs. Its worst winter in 28 years lifted vegetable prices. Investors worry that the higher inflation will limit the amount of money the government can inject into the economy.

“The good news about China is that it is in a trajectory of improvement. The bad news is that it may also boost inflation. In the US, people will be focused on earnings. It’s not great yet, but it certainly has the potential for improvement as we get further into the year,” said Bruce McCain, chief investment strategist at the private-banking unit of KeyCorp, according to Bloomberg.

Investors of banks felt optimistic after Warren Buffett voiced his vote of confidence in major financial institutions earlier this week. However, banks have seen the largest declines today, led by Wells Fargo (NYSE:WFC). The bank beat fourth-quarter earnings estimates, but margins narrowed and mortgage applications decreased.

The Dow Jones Industrial Average (INDEXDJX:.DJI) was up 0.04% to 13,476.95 points as of 12:55 p.m. EST.

Chevron (NYSE:CVX) has seen the biggest gains among Dow members today, climbing 1.20% to $111.80. Chevron posted a positive mid-quarter update, and it expects its fourth-quarter profit to exceed its third-quarter profit. The company predicts its exploration and production business will improve from the third quarter due partly to gains of $1.4 billion on an asset exchange in Australia.

Merck (NYSE:MRK) has seen gains today of 1.10% to 43.25. Merck will begin suspending the availability of its cholesterol drug Tredaptive. The drug intended to elevate “good” HDL cholesterol, but a larger study determined it failed to prevent heart problems.

Boeing (NYSE:BA) has slumped by 2.63% to $75.06. The Federal Aviation Administration will review the Boeing 787’s manufacturing process and design after the aircraft caught fire on Monday and suffered other technical problems.

Hewlett-Packard (NYSE:HPQ) also fell 1.78% to $15.99. HP CEO Meg Whitman asked her senior technology executive to cut $3.5 billion in costs from the company’s budget by the end of the year.

Twitter: @ChrisWitrak
No positions in stocks mentioned.