Higher open eyed on pharma M&A, GE rating view

NEW YORK (Reuters) - Stocks were set to rise at the open on Monday as news of a multi-billion dollar takeover in the drug industry buoyed sentiment and a credit rating agency offered some reassurance about its rating view for General Electric .

Shares of Wyeth jumped more than 4 percent before the bell to $45.75 after Pfizer Inc , the world's largest drugmaker, said it would buy its U.S. rival for about $68 billion in a move to diversify its revenue base.

"Deals of this quality and this magnitude will rekindle enthusiasm and hope about equity markets," said Andre Bakhos, president of Princeton Financial Group in New Brunswick, New Jersey.

"In the midst of a global recession, here is Pfizer, hopefully spending their dollars wisely. It adds a little confidence that all is not lost."

S&P 500 futures rose 6.70 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures were up 38 points, while Nasdaq 100 futures added 9.75 points.

Credit ratings agency Standard & Poor's said General Electric's top-notch investment grade ratings were not immediately affected by the company's fourth quarter results.

The S&P statement helped futures rebound from an earlier decline that had been triggered by a worrying outlook, job cuts and a quarterly profit slide from heavy equipment maker Caterpillar Inc , down 8.2 percent at $32.75 before the bell.

(Reporting by Ellis Mnyandu, Editing by Chizu Nomiyama)

WhatsAppFacebookTwitterLinkedinBeloudBluesky