Merck shares could not benefit from the sentiment in the German stock market, which progressively improved in the course of 2010. During the year, the Merck share price moved dynamically in a range between EUR 57 and EUR 73. However, compared to the price at the beginning of the year (EUR 65.21), Merck shares finished the year 8.2% lower, closing at EUR 59.85. The development of the share price was largely independent of the developments on the German stock market.
The market reacted with disappointment to the company’s initial outlook for 2010, which was cautious due to the difficulties encountered in 2009, as well as to the proposal to lower the dividend from EUR 1.50 to EUR 1.00. As a result of this announcement, which was made on February 23, with the publication of the annual results, Merck shares dropped by more than 10%, reaching their annual low of EUR 57.62 two days later. With the announcement of the acquisition of Millipore, the Merck share price rose by 2.9% on March 1. The share price did not exceed EUR 67 until the guidance was significantly raised on July 29 with the publication of the results of the second quarter. A high of EUR 72.28 was achieved on September 10. Just three days later, the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) surprised physicians and shareholders with its negative opinion regarding the marketing authorization application for cladribine tablets as a treatment for multiple sclerosis. As a consequence, Merck shares lost slightly more than 10% of their value on September 24. The subsequent selling pressure led to a decline in the share price to EUR 57.75 on November 17. Merck shares recovered slightly as of this date thanks to the news concerning FDA regulatory review of Egrifta ™ (tesamorelin), increasing to EUR 59.85 by year-end.
Nearly 600,000 shares traded daily
In 2010, an average of about 574,000 Merck shares were traded daily on the trading platforms of Deutsche Börse. On February 23, the date on which we published the annual results for 2009 and the outlook for 2010, 4.4 million Merck shares changed hands, making this the record-high trading day for 2010. Generally, the tradability of shares, expressed as the liquidity or the trading volume, is an important indicator that influences not only the buying behavior of investors, but also serves, in addition to the free-float market capitalization, as a key criterion in the composition of share indices. Based on a free-float market capitalization of EUR 3,868 million, Merck shares ranked 32nd among the largest German DAX companies at the end of the year. Based on a trading volume of EUR 9,226 million over the past 12 months, Merck shares took 28th place.