(Reuters) - U.S. stocks were a mixed bag on Tuesday, with the Dow ending lower after a handful of uninspiring earnings reports while the Nasdaq closed near a record high following a proposed biotech merger.
Yahoo Inc missed Wall Street's revenue and profit forecasts as slight growth in its online advertising businesses was outweighed by higher payments to partners and websites which send readers to Yahoo. Investors have been urging Mayer to cash in the stake, after Yahoo announced plans to spin off its position in Chinese internet retailer Alibaba Group Holding. The moves follow unsuccessful efforts by Mayer to revive meaningful revenue growth with a string of acquisitions and product revamps. For the first quarter, Yahoo said display advertising revenue rose 2.3 percent to $463.7 million, accounting for roughly 40 percent of its total revenue.
Yum's comments on China, its No. 1 market for revenue and profit, sent company shares up 4.5 percent to $84.52 in extended trading. Yum said China sales at established restaurants fell less than expected for the first quarter as it works to recover from allegations of improper meat handling at OSI Group's Shanghai Husi Food Co Ltd, which was a small supplier to Yum but a key supplier to rival McDonald's Corp. Both companies immediately stopped using the supplier. Yum is making "continued progress" in China, Chief Executive Greg Creed said in a statement. "We will deliver full-year EPS growth of at least 10 percent, with a strong second half in China and solid brand-building initiatives under way at each of our divisions," Creed said.
A high-frequency trader was arrested in London over his alleged role in the May 2010 "flash crash" that briefly wiped out nearly $1 trillion in market value, the first time authorities have blamed manipulation for the turbulence. The U.S. Justice Department said on Tuesday that it had criminally charged Navinder Singh Sarao, 36, of London, with wire fraud, commodities fraud and manipulation. "His conduct was at least significantly responsible for the order imbalance that in turn was one of the conditions that led to the flash crash," said Aitan Goelman, head of enforcement at the Commodity Futures Trading Commission, which filed parallel civil charges against Sarao on Tuesday. The case marks the first time U.S. regulators have alleged that market manipulation played a role in the flash crash, in which the Dow Jones Industrial Average plunged more than 1,000 points before recovering somewhat toward the end of trading.
TEL AVIV/NEW YORK (Reuters) - Teva Pharmaceutical Industries Ltd on Tuesday made an unsolicited $40 billion offer for smaller rival Mylan NV, a bold bid for growth as its lucrative Copaxone drug faces generic competition. The offer followed weeks of speculation that Israel-based Teva, the world's largest generic drugmaker, would soon target Mylan. Shares of Mylan traded below the offer price of $82 in cash and stock, evidence of investor skepticism that Teva can win over the company, which has set up a defense that includes a poison pill. Analysts agreed that Teva would need to sweeten its bid to the $90-per-share range.