Pharma deals, pact on government shutdown help stocks set more records

Hefty gains for energy and technology companies helped US stocks set more records Monday. Drug makers announced two major deals worth about $20 billion, and smaller-company stocks climbed after the Senate reached a short-term deal to end the government shutdown.

Stocks were slightly higher in the early going as strong fourth-quarter results from Halliburton helped energy companies, and big technology companies like Alphabet and Microsoft continued their ascent. Halliburton advanced 6.4 percent; competitor Schlumberger, which reported better-than-expected results Friday, gained 4.4 percent.

Starting at noon, after Senate Democrats said they would support a three-week government funding bill, bond yields increased and smaller-companies shook off their early losses to turn higher.


French drug maker Sanofi is buying hemophilia treatment maker Bioverativ in a deal the companies valued at $11.6 billion, while Celgene will buy cancer treatment maker Juno Therapeutics for $9 billion. Bioverativ, of Waltham, jumped 61.9 percent to $103.79, while Sanofi lost 3.1 percent to $43.20. Juno’s stock surged last week on reports Celgene might buy the company. On Monday, it rose 26.8 percent to $86, while Celgene added 26 cents to $102.91.

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In the financial sector, insurer AIG is buying Validus, a provider of reinsurance, primary insurance, and asset management services, for $5.56 billion. Validus gained 44 percent, to $67.29, and AIG slid 55 cents to $61.

Marina Severinovsky, an investment strategist at Schroders, said health care companies are likely to find more money for deals because the Republican-backed tax package gave the companies a one-time tax break on money they’ve been keeping overseas. Meanwhile, AIG’s big purchase is a sign of how far the company has come since the federal government bailed it out almost a decade ago.

‘‘AIG became synonymous with this $180 billion bailout and here they are making a deal with cash,’’ Severinovsky said. ‘‘We’ve got a pretty healthy global economy, and companies are more willing to take a risk than they have been in recent years.’’

The Standard & Poor’s 500 index picked up 0.8 percent, to 2,832.97. The Dow Jones industrial average rose 0.5 percent, to 26,214.60. The Nasdaq Composite added 1 percent, to 7,408.03. The Russell 2000 index of smaller-company stocks gained 0.5 percent, to 1,605.17.


The Senate was poised to pass a bill that will fund the federal government until early February. That came after Republican leaders said they will soon address immigration and other contentious political issues. The government shut down after the previous funding bill expired Friday.

Benchmark US crude rose 25 cents to $63.62 a barrel in New York. Brent crude, used to price international oils, added 42 cents to $69.03 a barrel in London.