Medivation surges on Pfizer takeover as US markets stay flat

Cancer drugmaker Medivation on Monday gained nearly 20 percent after the announcement it would be bought by Pfizer, but Wall Street stocks were otherwise generally flat.

The Dow Jones Industrial Average closed down 0.1 percent at 18,529.42 while the S&P 500 fell less than 0.1 percent to 2,182.64.

The tech-heavy Nasdaq, where Medivation is listed, rose 0.1 percent 5,244.60

Chris Low of FTN Financial said the markets were in wait-and-see mode, with a lack of economic data coming this week and a much-anticipated speech from Federal Reserve Chair Janet Yellen due on Friday in Jackson Hole, Wyoming.

"Traders are looking at this and are probably reluctant to take a position on either side of the market as long as there are opportunities for surprises," Low told AFP.

Pfizer on Monday announced it had reached a deal to purchase Medivation, which manufactures a prized prostate cancer medication, for $14 billion.

Pfizer was down 0.4 percent and Johnson & Johnson fell almost 0.7 percent. But Merck and Eli Lilly were both up 0.3 percent

Social media giant Twitter lost 2.3 percent.

Peter Cardillo of First Standard Financial Company told AFP that markets would likely continue to move sideways until Yellen's speech.

"We are looking at the Jackson Hole meeting later this week and I think this is going to keep the market in a range, a little higher, a little lower," he said. "Just trading sideways for most of the week."

Oil stocks were split on Monday as crude prices sank, with Chevron Corp down 0.4 percent but Exxon Mobil up 0.2 percent.

Oil services contractor Halliburton fell 3.8 percent while Baker Hughes was 1.7 percent lower than Friday's close.