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Hot Stock Minute: S&P Record, Now What? Big Pharma’s Big Concern

Dan Berman
Hot Stock Minute

Markets are set to kick-off the second quarter this morning at record highs. After weeks of near misses, the S&P 500 shattered its all-time record on Thursday closing at 1,569 ahead of the holidays. The Dow Jones Industrial Average also hit another high ending the session at 14,578. The Dow is up 11%, the S&P has climbed 10%, and the NASDAQ is up 8%.

One of the biggest stories of the first quarter is already making headlines here in the second: We're talking the fight for control of Dell (DELL). Bloomberg now reports that company founder Michael Dell would consider a buyout from Blackstone Group only if they agree to let him stay on as CEO. Back on February 5th Michael Dell and company announced a plan to go private in a deal with Silver Lake Management. Both Blackstone and Carl Icahn submitted competing bids.

A judgment against Novartis may be a bitter pill for all big pharma companies. India's Supreme Court has ruled against the Swiss drug giant, refusing to grant it patent protection for a blockbuster cancer drug. The ruling shows that Western drug makers can't count on India to provide them with much protection against locally-made generics. India is considered a burgeoning market for pharmaceuticals.


Whirlpool (WHR) keeps setting high-water marks. The stock has more than doubled since last June. On Friday S&P raised its credit rating on the appliance-maker to "BBB" citing improvements in the housing market and overall economy. Back in January, Whirlpool reported a 40% drop in profits, but that was because of a one-time charge. Whirlpool shares dropped to less than $20 at the start of the housing crisis. They're now trading at about six times that.

Next up, we have AT&T (T) which has announced another share buyback. The company board has approved the repurchase of 300-million outstanding shares. That's on top of another 300-million authorized nine months ago. Since last year, AT&T has bought back 539-million shares. That's 9% of all outstanding ones. AT&T's shares are currently trading about 25% ahead of where they were last April.

Churchill Downs (CHDN) is placing a new bet. The company which is best known for owning the site of the Kentucky Derby is purchasing Oxford Casino in Maine-- a place which opened just last year. Churchill says the acquisition is part of a larger plan to invest capital in gaming-friendly states and newer properties The company stock has been on a jagged climb, and hit its 52-week high on Thursday.