Wall Street has been in a celebratory mood lately, and the party looked poised to continue based on pre-market trading on Thursday morning. As of 8:30 a.m. ET today, Dow Jones Industrial Average (^DJI -0.59%) futures were up 51 points to 36,432, and S&P 500 (^GSPC -0.20%) futures had climbed 8 points to 4,792, both potentially heading toward another record close. Meanwhile, futures on the Nasdaq Composite (^IXIC) had gained 34 points to 16,525.
A couple of stocks stood out with big price moves in the early morning session, with Vector Group (VGR -2.55%) and Biogen (BIIB 0.64%) both heading lower. However, one of the declines was misleading, and the other merely reversed gains from yesterday on speculation that turned out not to have been as well founded as investors had hoped.
Vector Group finishes its spinoff
Shares of Vector Group were trading below $13 Thursday morning before the market open, at prices 25% lower than its $17.16 closing price on Wednesday. But the drop was due to the fact that the company completed a long-planned spinoff that will give shareholders new stock in a former subsidiary.
Vector Group's primary business is tobacco, but it has also been involved in real estate through its Douglas Elliman (NYSE:DOUG) subsidiary for a long time. Back in early November, Vector Group announced that it would allow Douglas Elliman to become an independent company, giving shareholders one share of Douglas Elliman for every two shares of Vector Group they owned.
The move gives investors the choice of whether to stay invested in Vector Group's core business, focus on Douglas Elliman's residential real estate brokerage business, or hold on to shares of both companies. It might also lead to more interest in Douglas Elliman from certain investors who prefer not to hold investments tied to the tobacco industry.
The value of the Douglas Elliman shares that investors receive should make up for the decline in Vector Group shares. It'll be interesting to see whether one of the stocks outperforms the other, reflecting different levels of interest from investors.
Biogen reverses course
Shares of Biogen were down almost 7% in pre-market trading Thursday morning. Investors were disappointed when some of their speculation about a possible acquisition turned out to be false, but overall, long-term shareholders didn't really get hurt.
On Wednesday, Biogen's stock jumped more than 9% on reports that the biologics business of South Korea's Samsung Group might be interested in buying the biotech company. The reports suggested a price tag that could approach $42 billion, which was about a 20% premium to Biogen's valuation before the jump.
However, Samsung Biologics subsequently said that the reports of a potential takeover weren't true. The statement didn't go into much detail about the reported acquisition, but what it did say was enough to cool investor sentiment from those who'd been hoping for a buyout.
Biogen has generated both excitement and controversy with the approval of its Alzheimer's treatment Aduhelm. Despite huge interest from those suffering from the disease, many question its effectiveness, and its high price tag has made insurance companies balk at the cost. With the stock having essentially gone nowhere for the past eight years, some Biogen investors are losing patience with the biotech company.