AstraZeneca Shares Surge on Renewed Bid From Pfizer --Update

By Dow Jones Business News, 
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By Josie Cox and Tommy Stubbington

Shares in AstraZeneca PLC surged after U.S. drug giant Pfizer confirmed it had made a renewed approach valued at nearly $100 billion, adding to an upbeat tone in equity markets Monday and helping sterling to a 4 1/2 year high against the dollar.

U.K.-listed AstraZeneca, which has declined to engage in talks with Pfizer, saw its shares climb almost 15% in early trade.

European shares bounced back to open the week on a stronger note, with the further signs of an uptick in merger- and-acquisition activity trumping tensions in Ukraine.

Elsewhere, Siemens AG of Germany barged in on Alstom SA's plans to sell its energy assets to General Electric Co. Sunday, proposing a counter offer to a proposed deal from last week.

That helped the Stoxx 600 Europe record a 0.3% gain in early trade, while Germany's DAX climbed 0.4%, France's CAC- 40 0.3% and the U.K.'sFTSE 100 0.3%.

"The boost to sentiment provided by recent outbreaks of M&A excitement shows how important corporate activity is to maintaining upward momentum, especially while earnings news remains so lukewarm," said Ian Williams, economist and strategist at brokerage Peel Hunt.

European indexes had fallen on Friday amid an escalation of the confrontation between Russia and Ukraine that rattled investors, and those fears helped keep a lid on gains Monday.

Over the weekend, pro-Russia rebels in eastern Ukraine raised the stakes in their conflict with Kiev by parading Western military observers as hostages and showing images of three bloodied Ukrainian intelligence officers the militants separately said they had detained.

The U.S. and European Union are now preparing to impose a new round of sanctions against Russia, Obama administration officials said on Sunday.

In currency markets, the pound jumped 0.3% to $1.6852, its strongest since November 2009. Analysts and traders said the prospect of the AstraZeneca deal was giving the British currency an extra boost amid a sluggish start to the week for the greenback.

"We are in an environment where M&A flows are supportive for sterling. That's a factor behind the move this morning," said Phyllis Papadavid, a senior foreign-exchange strategist at BNP Paribas.

Caution ahead of a raft of important U.S. economic data later in the week was weighing on the dollar, she added.

The euro also advanced, adding 0.2% to trade at $1.3868 against the dollar.

Write to Tommy Stubbington at tommy.stubbington@wsj.com


  (END) Dow Jones Newswires
  04-28-140445ET
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This article appears in: Forex and Currencies

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