Stocks return to record territory after deal news
NEW YORK (AP) — The Standard & Poor’s 500 index pushed back into record territory Monday after the latest round of corporate deal making made investors more confident.
KEEPING SCORE: The S&P 500 rose 16 points, or 0.9 percent, to 1,852 as of 3:20 p.m. (2020 GMT), four points above its record high close of 1,848 reached on Jan. 15. The index had slumped since then as investors grew worried about slowing growth in the U.S. and China, as well as emerging markets like Argentina.
The Dow Jones industrial average rose 146 points, or 0.9 percent, to 16,248 and the Nasdaq composite rose 36 points, or 0.9 percent, to 4,299. The Dow was led higher by energy stocks, with Exxon Mobil and Chevron up roughly 2 percent each.
SUIT SAGA: Jos. A. Bank rose $4.55, or 8 percent, to $59.57 after Men’s Wearhouse increased its offer for the clothing retailer by 10 percent. Men’s Wearhouse rose $3.50, or 8 percent, $48.61.
ICAHN’S LATEST TARGET: eBay rose $1.69, or 3 percent, to $56.29 after the activist shareholder Carl Icahn disclosed a 2 percent stake in the company. Icahn is looking to replace several members of eBay’s board of directors.
THE CHIPS ARE UP: RF Micro Devices jumped $1.29, or 21 percent, to $7.00 after the chipmaker said it was combining with TriQuint Semiconductor in an all-stock deal valued at about $1.56 billion. TriQuint soared $2.47, or 27 percent, to $11.71.
LET’S MAKE A DEAL (OR SEVERAL): M&A has taken off this year, particularly in the last couple weeks. Forest Laboratories and Actavis have announced a $25 billion merger and Facebook said it was buying WhatsApp for $19 billion. That’s on top of the RF Micro Devices-TriQuint and Signet Jewelers-Zale’s deals announced in the past week.
“It shows that companies still see value in this market, even at these highs,” said Quincy Krosby, a market strategist at Prudential Financial.
STREAMING DEAL: Netflix and Comcast reached an agreement to ensure that the online video service’s TV shows and movies are streamed smoothly. No details were released about the cost to Netflix. Comcast gained 18 cents, or 0.5 percent, to $51.23 and Netflix was up $15.07, or 4 percent, to $447.30.
LATER THIS WEEK: Investors had little in the way of corporate earnings or economic data to sort through Monday. Fed Chair Janet Yellen will testify in front of the Senate Banking Committee on Thursday. Investors will also get several economic reports this week, including durable goods orders and U.S. fourth-quarter gross domestic product.
TREASURYS AND COMMODITIES: Government bond prices were flat. The yield on the 10-year Treasury note was unchanged from Friday at 2.74 percent. The price of oil rose 57 cents to $102.77 a barrel. Gold increased $14 to $1,337.50 an ounce.