Stocks slumped for a second day, making it two losses in three days to start April as investors continued favoring safe havens over riskier assets. The S&P 500 and the Nasdaq Composite each lost about 1% while the Dow Jones Industrial Average barely missed out on that dubious distinction at -0.75%. Just three of the Dow’s 30 members closed higher on the day.
Amid the flight to safety, investors continue to favor the Japanese yen, a move that is pressuring international stocks as highlighted by Tuesday’s declines for European and emerging markets shares.
There were some bright spots on Wall Street and, interestingly, it was controversy in one form or another, that helped Marvell Technology Group Ltd. (NASDAQ:MRVL), Pfizer Inc. (NYSE:PFE) and Valeant Pharmaceuticals Intl Inc (NYSE:VRX) to rank as three of today’s best stocks.
Marvell Technology Group Ltd. (MRVL)
Semiconductor maker Marvell Technology surged 13.1% on volume that was more than quadruple the daily average on news of executive turnover at the company. MRVL CEO Sehat Sutardja and President Weili Dai left their positions, though the pair will remain members of the MRVL board.
Last week, MRVL said it expects sales to slump this year and that it will not file its annual report on time. MRVL recently changed accounting firms and conducted an investigation into its internal controls.
On news of the executive departures, Brean Capital upgraded MRVL to “buy” from “hold” with a $12.50 price target.
Pfizer Inc. (PFE)
Pfizer, a member of the Dow Jones Industrial Average, rose 2.1% on news the pharmaceuticals giant is mulling dropping its mega deal for rival Allergan plc (NYSE:AGN) amid a U.S. government crackdown on corporate inversions.
An inversion is where a U.S.-based company acquires a rival with a foreign domicile to save money on U.S. taxes. AGN has an Ireland domicile.
PFE is concerned the U.S. government will continue changing its inversion rules to make the company’s deal for AGN, valued at $160 billion, difficult to complete. If PFE breaks the deal with AGN, it would have to pay a $400 million breakup fee. The same is true if AGN moves to scrap the deal with PFE.
“The U.S. Treasury Department took new steps on Monday to curb tax-driven corporate inversions whereby companies seek to slash their tax bills by redomiciling overseas, though their core operations and management usually remain in the United States even as they claim a new tax home,” reports Reuters.
Valeant Pharmaceuticals Intl Inc (VRX)
Valeant Pharmaceuticals, which is seemingly always controversial and always making headlines, was doing just that Tuesday, but on a positive note. Shares of VRX climbed 10% on heavy volume after the company said it completed an accounting review and discovered no new issues to draw the ire of eager short sellers.
VRX said the completed review indicates the company will not have to make any more financial restatements than previously thought. VRX is hoping to release its 2015 results by the end of this month.
Canada-based VRX is facing federal probes into its accounting practices. The stock is down more than 70% this year.
At the time of this writing, Todd Shriber did not own shares of any of the aforementioned securities.
