Biotechnology stocks and sector-related ETFs were among the best performers Monday after Eli Lilly (NYSE: LLY) said it will acquire Loxo Oncology Inc. (NasdaqGS: LOXO) for $8 billion.
Among the best performers on Monday, the ALPS Medical Breakthroughs ETF (NYSEArca: SBIO) jumped 8.2%, testing its short-term resistance at the 50-day simple moving average. Other sector-related ETFs that track smaller biotech names also rallied, with the SPDR S&P Biotech ETF (NYSEArca: XBI) up 6.1% and Virtus LifeSci Biotech Clinical Trials ETF (BBC) up 4.3%. Meanwhile, the iShares Nasdaq Biotechnology ETF (NASDAQGM: IBB), the largest biotech exchange traded fund by assets, gained 3.9%.
Eli Lilly said it is buying Loxo Oncology in a cash deal to expand the biopharmaceutical company’s oncology-treatment portfolio and added to a number of recent deals in the cancer-treatment space, the Wall Street Journal reports.
LOXO shares jumped 66.1% on the announcement. LOXO makes up 4.7% of SBIO’s holdings and 1.4% of XBI.
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