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US shares fall despite Kraft Heinz mega merger

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US shares were seeing red, along with global indices, on Thursday as tech stocks felt the heat and spite of one of the most intriguing merger deals so far this year.

The Dow Jones Industrial shed down 43 points to 17,967, Nasdaq lost 27 to 4,968, while the broader-based S&P500 was a point lower at 2,091.

The NASDAQ was down despite the blockbuster merger announcement of Cadbury’s owner Kraft and baked bean specialists Heinz.

Heinz shareholders will hold 51% of the combined company's equity, though Kraft will get top billing in the new name, the Kraft Heinz Company. Shares in Kraft rocketed 31% to US$80.

3G Capital, the Brazilian private equity firm that owns Heinz, closed the deal with the backing of Berkshire Hathaway, the insurance company controlled by legendary investor Warren Buffett.

Back on the Dow, two of the biggest risers were oil giants Exxon Mobil, up 1.1% to US$85 and Chevron, up 1% to US$105.

Both rebounded after falling yesterday as the  oil price rose by 1.7%.

Merck was the highest riser early as the pharma giant has authorised another US$10bln buyback. Shares were up 1.25% to US$ 59.

The biggest faller was Microsoft down 1.3% to US$42 after, for the first time, it decided not to ban rivals from its World Partner Conference. 

Elsewhere, printing expert Lexmark is to purchase software specialists Kofax for $1bn or $11 per share. 

Lexmark shares jumped 6% to US$43 while Kofax shares rocketed 45% to US$10.9.

Elsewhere UK stocks were fairly flat today, with the FTSE 100 down 4 points after shedding 18 points yesterday, with banking giants Barclays down 2.25% to 252p.


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