Stocks dithered Wednesday, but continued flirting with all-time highs as traders backed away from riskier assets, forcing oil prices lower while Treasuries rose.
Ahead of an avalanche of bank earnings starting Thursday, the S&P 500 rose 0.01% while the Dow Jones Industrial Average added 0.13%. The Nasdaq Composite lost 0.34%.
On a slow day for stocks, Juno Therapeutics Inc (NASDAQ:JUNO), Kinder Morgan Inc (NYSE:KMI) and Level 3 Communications, Inc. (NYSE:LVLT) offered plenty of upside action.
Juno Therapeutics Inc (JUNO)
Biotechnology firm Juno Therapeutics Inc soared 9.5% on more than five times the average daily volume after the company said the Food & Drug Administration (FDA) lifted a hold on JUNO’s treatment for acute lymphoblastic leukemia (ALL).
Last week, shares of JUNO plunged after the FDA placed a clinical hold on the treatment following the deaths of two patients in the trial. The review of JUNO’s JCAR015 treatment is seen as rapid by some industry analysts.
“The quick FDA action not only indicates that Juno has addressed the FDA’s requests with success, but also highlights the positive risk/benefit ratio of JCAR015 therapy in these advanced relapsed/refractory adult ALL patients,” according to a note by Leerink analyst Michael Schmidt posted by Investor’s Business Daily.
Kinder Morgan Inc (KMI)
Shares of pipeline operator Kinder Morgan Inc continue gaining momentum, rising 2% on above-average volume Wednesday. Analysts are warming to KMI’s debt reduction efforts. Last week, KMI said it will sell a 50% stake in a natural gas pipeline to electric utility Southern Co (NYSE:SO). KMI is expected to use the $1.47 billion in proceeds to trim debt.
Moody’s Investors Service said the deal will have “a small but positive impact on leverage,” reports Barron’s. The same Barron’s article also notes that Fitch Ratings called KMI’s deal with SO “credit positive.” Fitch rates KMI debt one notch above junk status.
Investors are likely hoping KMI’s debt reduction efforts will return the company to its past dividend growth trajectory, something KMI was known for prior to slashing its dividend to conserve cash earlier this year.
Level 3 Communications, Inc. (LVLT)
Level 3 Communications, Inc., a provider of communications equipment, rose 3.5% on more than triple the usual turnover on speculation the company is looking to increase shareholder value, potentially by way of a significant share buyback. There is also talk that LVLT could look to sell itself.
In a note out Wednesday, Citigroup analysts Michael Rollins and Neth Wiedemann say LVLT’s “extensive enterprise presence could be attractive for a cable player looking to move up-market and accelerate its investment from the small- to medium-sized businesses segment into the enterprise market,” according to an excerpt of the note posted by Barron’s.
The Citi analysts also said LVLT trades at multiples that are inexpensive relative to the company’s growth profile.
As of this writing, Todd Shriber owned shares of KMI.
