Skip to main content
Advertising

Originally published May 19, 2014 at 6:58 AM | Page modified May 20, 2014 at 6:37 AM

  • Share:
             
  • Comments (0)
  • Print

Stocks edge higher after drifting in early trade

Stocks finished slightly higher on Monday, adding to the small gains the market carved out at the end of last week.


AP Business Writer

advertising

Stocks finished slightly higher on Monday, adding to the small gains the market carved out at the end of last week.

A dearth of fresh economic data had many investors focusing on headline-grabbing corporate deals, including a $48.5 billion bid by AT&T to acquire satellite TV provider DirecTV and a joint venture between Johnson Controls and a Chinese company that will form the world's largest maker of automotive interiors.

The latest batch of deals is a good sign for the market and further illustrates that many companies have the financial ammunition and appetite to grow through acquisitions.

Even so, much of the market remained in drift mode Monday, but still near the latest all-time high set by the Standard & Poor's 500 index a week ago.

"We're seeing big deals -- this AT&T deal is big," said Marc Doss, regional chief investment officer for Wells Fargo Private Bank. "But it's not enough to drive us dramatically higher in the short run."

The three major indexes were down in premarket trading as investors reacted to the AT&T-DirecTV deal, which was announced late Sunday. The proposed deal would create the second-largest pay TV operator behind a combined Comcast-Time Warner Cable. But such a combination could face close scrutiny from the Federal Communications Commission and Department of Justice.

When regular trading began, the S&P 500 and Nasdaq composite drifted into positive territory, while the Dow Jones industrial average lagged.

AT&T and DirecTV opened lower and never recovered. AT&T ended down 36 cents, or 1 percent, at $36.38. DirecTV fell $1.53, or 1.8 percent, to $84.65.

Word that AstraZeneca rejected rival drugmaker Pfizer's latest takeover offer helped boost Pfizer's shares 16 cents, or 0.5 percent, to $29.28.

Pfizer has been courting AstraZeneca since January. It announced Sunday that it was ready to raise its stock-and-cash offer by 15 percent to $118.8 billion.

By midmorning, major U.S. indexes had each captured small gains that would hold the rest of the day.

The S&P 500 index gained 7.22 points, or 0.4 percent, to close at 1,885.08.

The Dow Jones industrial average added 20.55 points, or 0.1 percent, to end at 16,511.86.

The Nasdaq composite index rose 35.23 points, or 0.9 percent, to finish at 4,125.82.

The S&P, which hit an all-time high two days in a row early last week, is up 2 percent for the year. The Dow and Nasdaq remain down for 2014.

The yield on the 10-year U.S. Treasury note rose to 2.54 percent from 2.52 percent late Friday.

Investors are in a wait-and-see mode, having digested a mostly positive but unspectacular batch of first-quarter corporate earnings in recent weeks, in addition to mixed economic news.

A light schedule of economic reports for much of this week means investors may not get much fresh insight about the economy until later this week, when they'll see new figures on sales of previously occupied homes and newly built homes. On Wednesday, the Federal Reserve releases the minutes of last month's meeting of the central bank's policy committee.

"To this point, we've seen a rotation within and not out of equities, and we expect that trend to continue into the mid-year," said Terry Sandven, chief equity strategist for U.S. Bank.

Among other stocks making merger-related gains on Monday was Abbott Laboratories. Financial analysts cheered the medical device maker's proposed acquisition of CFR Pharmaceuticals for nearly $3 billion. Abbott's stock rose 57 cents, or 1.5 percent, to $39.63.

Meanwhile, Johnson Controls jumped $1.91, or 4.3 percent, to $46.69 on news of its planned venture with China-based Yanfeng Automotive Trim Systems.

Seven of the 10 industry sectors in the S&P 500 ended trading higher, led by technology stocks. Utilities were the biggest laggard.

TripAdvisor topped all stocks in the S&P 500, gaining $4.25, or 5.2 percent, to $86.41. American Electric Power posted the biggest decline, falling $1.68, or 3.2 percent, to $51.02.

Campbell Soup also ended lower after the food company reported earnings that fell short of Wall Street estimates. The company also lowered its full-year revenue outlook, noting that it was disappointed that soup sales failed to meet expectations. Its shares fell $1.06, or 2.3 percent, to $44.06.



Want unlimited access to seattletimes.com? Subscribe now!

News where, when and how you want it

Email Icon

Get ready for 2015

Get ready for 2015

The Seattle Times 12-month wall calendar features hand-picked photos of life in the Pacific Northwest. Order while supplies last!

Advertising

Advertising


Advertising
The Seattle Times

The door is closed, but it's not locked.

Take a minute to subscribe and continue to enjoy The Seattle Times for as little as 99 cents a week.

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Subscriber login ►
The Seattle Times

To keep reading, you need a subscription upgrade.

We hope you have enjoyed your complimentary access. For unlimited seattletimes.com access, please upgrade your digital subscription.

Call customer service at 1.800.542.0820 for assistance with your upgrade or questions about your subscriber status.

The Seattle Times

To keep reading, you need a subscription.

We hope you have enjoyed your complimentary access. Subscribe now for unlimited access!

Subscription options ►

Already a subscriber?

We've got good news for you. Unlimited seattletimes.com content access is included with most subscriptions.

Activate Subscriber Account ►