Wall St. flat after Japan, China data; biotechs climb

U.S. stocks were little changed on Monday, as investors weighed the strength of the U.S. economy against global growth concerns following soft data out of China and Japan, while biotechs rose on merger activity.

Major indexes opened slightly lower after data showed China's exports grew at a slower-than-expected pace and imports dropped 6.7 percent in November, while Japan's economy shrank more than expected in the third quarter.

But signs of strength in the U.S. economy, including Friday's payrolls report, helped investors shake off weakness in global economies. The S&P 500 closed Friday's session with its 49th record of the year, and is up more than 11 percent from an October low.

"Overall, the U.S. numbers still remain pretty strong, we had very strong numbers on Friday from the employment report, that’s probably why you are seeing the strength here," said Peter Jankovskis, co-chief investment officer at OakBrook Investments LLC in Lisle, Illinois.

"The other side of it, too, is many of these other countries are taking some efforts to stimulate as well. People are looking at is as temporary, and somewhere down the line as those economies get stronger, everybody will be in pretty good shape."

Biotech shares rallied after Merck & Co Inc said it would buy Cubist Pharmaceuticals Inc for $8.4 billion plus the assumption of debt. Merck shares were off 1 cent at$61.48 while Cubist shares surged 35.5 percent to $100.75. The Nasdaq biotech index advanced 2.1 percent.

Energy was easily the worst performing S&P sector, down 2.7 percent, as Brent crude fell to a five-year low on predictions oversupply would keep building until next year. The index is down more than 10 percent for the year, making it the only one of the 10 major S&P sectors in negative territory for the year. [O/R]

In response to falling oil prices, ConocoPhillips said its capital budget for 2015 would drop 20 percent to $13.5 billion. Conoco shares lost 3.1 percent to $65.73.

The Dow Jones industrial average fell 11.19 points, or 0.06 percent, to 17,947.6, the S&P 500 lost 1.11 points, or 0.05 percent, to 2,074.26 and the Nasdaq Composite added 8.03 points, or 0.17 percent, to 4,788.79.

McDonald's shares lost 3.2 percent to $93.18 after the fast-food restaurant chain reported a steeper-than-expected fall in global same-restaurant sales in November and said fourth quarter results would be hurt by a supplier scandal in China and a stronger dollar.

Reuters