US stock indexes rise broadly in midday trading; Hospira surges following news of Pfizer deal

EnergyAssociated Press

U.S. stocks rose broadly Thursday, helped by a rebound in the price of oil and a rise in health care stocks following Pfizer's $16 billion deal to buy drugmaker Hospira.

The strength in U.S. markets contrasted with weakness in Europe. Greek stocks plunged as the tensions between Greece's new left-wing government and the European Central Bank intensified.

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KEEPING SCORE: The Dow Jones industrial average rose 150 points, or 0.9 percent, to 17,823 as of 11:03 a.m. Eastern. The Standard & Poor's 500 index rose 17 points, or 0.8 percent, to 2,059 and the Nasdaq composite rose 32 points, or 0.7 percent, to 4,748. The S&P 500 and Dow turned positive for 2015.

LET'S MAKE A DEAL: Drug giant Pfizer said it would buy Hospira, a maker of injectable drugs, for $90 a share, or $16 billion in cash. The deal is the first one by Pfizer since it walked away from its merger with AstraZeneca last year. Like many other large drug companies, Pfizer is trying to generate more sales as its blockbuster drugs go generic. Hospira soared $22.74, or 35 percent, to $87.54 and Pfizer rose 98 cents, or 3 percent, to $33.05.

EUROPE PRESSURE: Greece's new left-wing government is insisting it will stick to its anti-austerity agenda, hours after the European Central Bank tightened the screws on Athens by withdrawing a key borrowing option for the country's banks.

The ECB said late Wednesday it would no longer accept Greece's junk-rated government bonds as collateral when Greek banks need to borrow money, as prospects for a new deal with bailout creditors appear uncertain. Greece's new finance minister also failed to convince his German counterpart to back a new approach on Greece's debt as the two met for the first time since Syriza swept to power in Athens.

Greek stocks dropped 3 percent on the news. Germany's DAX was down 0.1 percent, France's CAC 40 was flat and the U.K.'s FTSE 100 edged up 0.1 percent.

ANALYST'S TAKE: "The decision by the ECB to no longer accept Greek bonds as collateral may be aimed at piling the pressure on Greece to request an extension of its current bailout beyond February 28, but it is has also raised the risk that Greece could be forced into a default," said Jane Foley, an analyst at Rabobank International.

SOARING SONY: Sony jumped 3 percent after the Japanese electronics and entertainment company lowered its loss projection for the fiscal year late Wednesday, and said it expected the hack at its movie division to have minimal impact in the long run. Sony's U.S.-listed shares rose 77 cents to $26.71.

ENERGY: Benchmark U.S. crude rose $2.66 to $51.13 a barrel on the New York Mercantile Exchange. It had plunged $4.60, or 8.7 percent, to settle at $48.45 a barrel the day before after the U.S. government reported an increase in crude inventories last week. Brent crude, a benchmark for international oils, rose $2.04 to $56.18 a barrel in London.

TIME FOR A BREAKUP?: DuPont said it was appointing two new directors to the company's board, both with experience in restructuring large conglomerates, a sign that DuPont may be bowing to activist investor pressure to break up the chemical giant. DuPont was up 53 cents, or 0.7 percent, to $74.27.

CURRENCIES: The euro was flat at $1.1431 while the dollar rose 0.2 percent to 117.44 yen.

BONDS: U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 1.81 percent.


AP Business Writer Yuri Kageyama contributed to this report from Tokyo.