In the wake of news that U.S. allies in the Middle East will be purchasing $350 billion worth of defense and military hardware over the course of the next ten years, the bulls were willing to pick up where they left off on Friday. By the time Monday’s closing bell rang, the S&P 500 was up 0.52% to end the session at 2,394.02.
Not every name got on board the bullish train today, however. Advanced Micro Devices, Inc. (NASDAQ:AMD), Forterra Inc (NASDAQ:FRTA) and Amgen, Inc. (NASDAQ:AMGN) all moved in the other direction, however, albeit for understandable reasons.
Here’s what traders need to know.
Advanced Micro Devices, Inc. (AMD)
Last Tuesday, chipmaker Advanced Micro Devices shares surged 8% on the heels of news that rival/partner Intel Corporation (NASDAQ:INTC) had inked a deal to use its graphical display technologies in future hardware. As it turns out though, the “news” wasn’t true. The next day, AMD stock gave all of that gain back when the company didn’t say a word about any such deal at an analyst event after that day’s close.
In the meantime, the prospect of that Intel/AMD further withered. At a technology conference hosted by J.P. Morgan today, Advanced Micro Devices CEO Lisa Su made a point of saying of the rumors, “We’re not looking at enabling a competitor to compete against our products.”
AMD ended the day down 3.3%.
Amgen, Inc. (AMGN)
Shares of biotechnology stock Amgen ended the day down 2.2% after its osteoporosis drug may be riskier to users than first expected.
On Sunday, Amgen and its partner UCB Pharma announced that their jointly-developed osteoporosis drug, romosozumab, successfully limits the possibility of vertebrae fractures after menopause. But, it may also increase the odds of heart attacks to the tune of 30%.
The additional findings from the company’s study won’t necessarily prevent the FDA from approving the drug. However, the company cautioned AMGN shareholders that the finding could delay the drug’s approval by a year or more from its originally expected decision due in July. On the flipside, the update does lower the odds of an approval. Leerink analyst Geoffrey Porges gives romosozumab a 50/50 shot at an approval now.
Forterra Inc (FRTA)
Finally, pipe manufacturer Forterra lost 15.5% of its value on Monday, bringing the six-day rout to 54%. Don’t look for a specific reason FRTA sold off again today, however. Rather, Monday’s weakness was just an extension the selloff that got rolling last week.
On the surface, its first-quarter earnings report looked fine. Revenue almost doubled. Yet, a closer look revealed that all of that growth stemmed from acquisitions rather than organic growth. Worse, the loss of 35 cents per share was leaps and bounds worse than the expected loss of nine cents per share of FRTA. The growth strategy isn’t paying off like it needs to.
Fanning the bearish flames that have scorched FRTA in the meantime is a string of pending fraud cases being prepped against the company.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.
