Stocks rise before holiday

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U.S. stocks entered the Memorial Day holiday with solid gains despite news of a worse-than-expected drop in home sales.  The Russell 2000 added 6.13 points, or 0.74%, to 829.93.  The Dow Jones Industrial Average moved up 66.15 points, or 0.49%, to close at 13,507.28.

Shares of Canadian bottling company Leading Brands, Inc. (Nasdaq: LBIX) finished the day in the winners column following news that it beat revenue estimates.  Revenues for the fiscal year ended Feb. 28 were $50.37 million, an increase of 28% compared with $39.3 million in the prior year, Leading Brands reported before the opening bell.  Analysts were expecting the company to bring in $47.08 million.  The net loss for the year was $3.55 million, or $0.23 per share, compared with a net loss of $1.28 million, or $0.08 per share, a year earlier.  However, the company attributed the loss to a one-time charge of $3.2 million associated with the purchase of new plant equipment.  Shares rose $0.42, or 14%, to close at $3.34.

Lincolnshire, Ill.-based Biosante Pharmaceuticals, Inc. (AMEX: BPA) will make a private placement of 2,754,999 million shares of its common stock at a purchase price of $6.00 per share to institutional investors, the company said before the start of trading.  Investors will also receive warrants to purchase 688,750 shares of common stock at an exercise price of $8.00 per share.  Biosante said it expects net proceeds of about $15.6 million, which it will use to expand its Phase III clinical program of a treatment for female sexual dysfunction.  The stock shed $0.35, or 5%, to end at $6.50.

Shares of Abraxas Petroleum Corp. (AMEX: ABP) jumped up in midday trading today and closed with a gain of $0.65, or 18%, to $4.25, on news the San Antonia, Texas-based company will redeem its existing $125 million senior secured notes.  Abraxas will get rid of its debt after a series of transactions that are expected to be completed today.  The sudden infusion of cash came after the company formed a master limited partnership with Abraxas Energy Partners, L.P., which resulted in a net gain of $147.3 million.  The excess funds will be used to fund future drilling operations, the oil and gas explorer said.

Sales of existing U.S. homes fell the most in four years in April, the National Association of Realtors reported today.  Sales were 5.99 million at an annualized rate, down 2.6% from 6.15 million in March.  Economists had predicted a sales rate of 6.18 million.

Elsewhere, Nasdaq said it will pay $3.7 billion for Swedish stock exchange OMX AB after a previous bid for the London Stock Exchange failed.

The following were the most actively traded companies in Friday's trading among those with market capitalizations under $500 million: