Up­beat data, In­tel deal boost stocks

Los Angeles Times - - TECHNOLOGY - As­so­ci­ated press

Stocks rose Mon­day af­ter the re­lease of some en­cour­ag­ing eco­nomic data and news of a big ac­qui­si­tion in the semi­con­duc­tor in­dus­try.

The gains were mod­est but broad. Eight of the 10 in­dus­try sec­tors in the Stan­dard and Poor’s 500 in­dex ended higher, led by industrial stocks with a gain of 0.4%.

The big­gest gainer in the S&P 500 was chip designer Al­tera, the tar­get of a $17-bil­lion cash of­fer by gi­ant chip maker In­tel. Al­tera jumped $2.83 to $51.68, a 6% gain. Com­pa­nies have been com­bin­ing at a rapid clip, help­ing to boost stocks in the sev­enth year of the bull mar­ket.

The S&P 500 rose 4.34 points, or 0.2%, to 2,111.73. The Dow Jones industrial av­er­age rose 29.69 points, or 0.2%, to 18,040.37. The Nas­daq com­pos­ite climbed 12.90 points, or 0.3%, to 5,082.93.

In eco­nomic news, U.S. man­u­fac­tur­ing growth ac­cel­er­ated in May for the first time in six months, pro­pelled by more new or­ders and an in­crease in hir­ing, ac­cord­ing to the In­sti­tute for Sup­ply Man­age­ment, a trade group. A sep­a­rate re­port showed con­struc­tion spend­ing climbed in April to the high­est level in more than six years.

In­vestors are anx­ious about U.S. growth fol­low­ing a se­ries of weak data, capped by news Fri­day that the econ­omy shrank in the first three months of the year. They’ll have a bet­ter sense of the growth out­look this week af­ter sev­eral other eco­nomic re­ports are re­leased, cul­mi­nat­ing Fri­day with one on hir­ing in May.

The Al­tera deal fol­lows sev­eral other block­buster cor­po­rate deals re­cently, in­clud­ing a $55-bil­lion ac­qui­si­tion by Char­ter Com­mu­ni­ca­tions for ri­val Time Warner Ca­ble last week. So far this year, more than $700 bil­lion in deals have been an­nounced, a 43% jump from the same pe­riod a year ear­lier, ac­cord­ing to S&P Cap­i­tal IQ.

In­tel fell 55 cents to $33.91, a loss of 1.6%, the big­gest drop in the Dow in­dex.

The price of oil slipped slightly as the dollar gained strength, mak­ing oil less at­trac­tive to hold­ers of for­eign cur­ren­cies. Bench­mark U.S. crude fell 10 cents to close at $60.20 a bar­rel in New York. Brent crude, a bench­mark for in­ter­na­tional oil used by many U.S. re­finer­ies, fell 68 cents to close at $64.88 a bar­rel in Lon­don.

In other fu­tures trad­ing on the NYMEX, whole­sale gaso­line fell 2.1 cents to close at $2.042 a gal­lon.

U.S. gov­ern­ment bond prices fell. The yield on the 10-year Trea­sury note rose to 2.18% from 2.12% late Fri­day.

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