9:45AM U.S. stock markets opened mixed. Subprime mortgage worries weighed.
U.S. stock markets opened mixed on Monday, reflecting growing concerns of a possible crisis in the subprime mortgage market. A warning from New Century Financial about its financial woes offset the positive sentiment, generated by some significant merger news. The troubled mortgage lender was downgraded by UBS after it said its lenders are cutting off credit. New Century’s (NEW) stock plunged 56% in pre-market trade, while in early trading it was down only 17%. One of the nation's largest mortgage lenders, Countrywide Financial (CFC) dropped 2% after it said that the volume of subprime loans it made in February declined because of tightened lending standards. Investors worry that problems from subprime may spread to other parts of the U.S. loan market, affecting companies such as IndyMac Bancorp. (NDE), down 3.4%, Impac Mortgage Holdings. (IMH) down 4.7%, and even General Motors (GM), falling 0.7%.

The downside trend for the market was limited by significant strength in the healthcare sector on the back of merger-and-acquisition news. Schering-Plough Corp. (SGP) edged up after it agreed to buy Organon BioSciences for $14.4 billion in cash from Holland's Akzo Nobel (AKZOY). Akzo Nobel shares jumped 15%. Sierra Health Services (SIE) surged 16%, helping to lead the sector higher after the company agreed to be acquired by UnitedHealth (UNH) for $2.6 billion. Outside the sector, discount retailer Dollar General Corp. (DG) surged 27% after it agreed to be acquired by affiliates of private equity firm Kohlberg Kravis Roberts & Co. in a deal valued $7.3 billion. In the opening minutes of trading, the Dow Jones industrial average fell 5.28, or 0.04%, to 12,271.04. The Standard & Poor's 500 index fell 1.19, or 0.08%, to 1,401.66, and the Nasdaq composite index 0.95, or 0.04%, to 2,386.60.


9:30AM London trades lower as miners offset merger-and-activity gains.
The UK market was lower on Monday. The FTSE 100 was trading at 6,228, or 0.28% down.

Advancers

Alliance Boots surged 7.4% in response to the unprecedented 10 pounds per share offer on Friday. The board of the chemist chain is meeting today to discuss the offer. ICI is another advancer on the back of speculation that Akzo Nobel may be mulling an offer.

Hiscox was up 2.9% after stronger figures. Underwriter Hiscox posted a record 201.1 million pounds profit as claims eased as premiums soared. Lookers is up, 4.8%, after the car dealer reported a 32% increase in year profit last year to 21.4 million pounds compared with 16.4 million pounds in 2005. The firm reported strong growth across all areas of the business with turnover up 16%.

Decliners

J Sainsbury fell 2.3% though as KKR, which is backing Stefano Pessina offer for Alliance Boots, may now have too much to pursue its interest in the supermarket chain. Marks & Spencer is down 1.2% in sympathy.

Meanwhile, miners such as Rio Tinto, down 0.2% and BHP Billiton, trading flat, are off their best levels or in the red. Among the mid-caps, although housebuilder Bovis posted a 14% gain in underlying profits last year to 132 million pounds, it fell 2.9%. The firm added that housing market fundamentals remained robust.


9:00AM Schering-Plough agreed to buy Alzo Nobel for $14.4 billion.
Schering-Plough (SGP) announced on Monday that it agreed to buy pharmaceutical division of Dutch Akzo Nobel (AKZOY) in a cash deal worth $14.4 billion (11 billion euros). The acquisition of Organon Bio Sciences is expected to boost its line-up of central nervous system and women''s health-care products, adding five products in Phase III trials and other projects in Phase II development. Organon''s research and manufacturing unit in Oss, the Netherlands, will become Schering-Plough''s global gynecology and fertility activities center. In 2006 Organon''s pharmaceutical business had sales of $3.4 billion, led by Folistim/Puregon, Esmeron/Zemuron and NuvaRing and Implanon.

Schering-Plough also expects the deal to contribute to higher earnings in its first full year, excluding purchase-accounting adjustments and acquisition-related costs. It estimates $500 million a year in synergies in the third full year. As soon as the sale closes, Akzo Nobel plans to buy back up to 1.3 billion euros of its shares. Akzo''s shares soared 19% to 55.01 euros ($72.28) in Amsterdam trading.


8:30AM Asian markets ended higher on Monday on Japanese exporters
Asian markets ended higher on Monday. The Nikkei average in Tokyo closed 0.8% higher at 17,292.39. Exporters benefitted from a weaker yen. Fanuc gained 1.9%, leading broad gains among machinery-related makers. Chip-equipment company Tokyo Electron advanced 1.1% after a report that the group is on track to improve its annual profit forecast by 3.8% on higher-than-expected demand. Sony added 1.3%, while Canon was up 1%. Nikko Cordial declined 0.5% though. After markets closed the Tokyo Stock Exchange, in a surprise move, said it had decided not to delist the brokerage firm.

Hong Kong Hang Seng Index finished 1.6% higher at 19,442.42. Tom Groupgained 5.4% after the media and Internet company said it would offer $201.3 million to privatize Tom Online. China Mobile gained 1.3% in Hong Kong, recovering from several days of losses. Shares of HSBC Holdings rose 0.4% in Hong Kong. The bank will see its weighting cut to 20% from about 23%. China Life Insurance and Industrial & Commercial Bank of China both gained as they were elevated to large-cap status. Shares of China Life gained 1.4% and ICBC nudged higher 0.2%.

Australia S&P/ASX 200 finished 1% higher at 5,891.00 and South Korea Kopsi finished up 1.3% at 1,441.33. Singapore Straits Times Index closed up 1.2% at 3,182.68 and Taiwan Weighted Price Index ended 0.8% higher at 7,629.15. China Shanghai Composite Index ended 0.6% higher at 2,954.91.


8:00AM NY-7:00PM Mumbai Sensex ends marginally higher on strong capital goods.
The Sensex on BSE finished 17.64 points, or 0.14%, higher at 12,902.63. The market-breadth was strong as there were three advancers for every two decliners. For 1,540 stocks that advanced, 1,017 declined and only 57 remained unchanged. Of the 30 stocks in the Sensex, 18 advanced, while the rest declined. The turnover on BSE was Rs 3,417.17 crore, compared with Rs 4,339.08 crore on Friday, while on NSE, the turnover was Rs 8,331.19 crore, lower than Rs 9,641.18 crore on Friday.

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