Food companies fall; Dow rises

NEW YORK — Amazon’s $13.7 billion deal for Whole Foods sent grocery stores, big retailers, and food makers and distributors plunging Friday. Energy companies rose while other stocks were little changed.

The Standard & Poor’s 500 index inched up 0.69 points to 2,433.15. The Dow Jones industrial average added 24.38 points, or 0.1 percent, to a record high of 21,384.28. The Nasdaq composite fell 13.74 points, or 0.2 percent, to 6,151.76. The Russell 2000 index of smaller company stocks shed 3.36 points, or 0.2 percent, to 1,406.73.

It’s rare for a single deal to have a big effect on the broader stock market, but Amazon’s agreement to buy Whole Foods Market did. Investors wondered if Amazon will do to grocery stores and supermarkets what it’s done to sellers of goods like clothing and office supplies: force them to make big changes or be supplanted.

Neil Saunders, managing director of the research firm Global Data Retail, said Amazon is likely to push supermarkets and grocery stores to lower prices, which will affect the companies that make and distribute those products.

“As Amazon enters the grocery market proper, it will put a lot more pressure on existing grocers,” he said. “Those grocers will respond by cutting prices and that will cut profits for the distributors.”

Elsewhere, energy companies rose as oil futures bounced back from their lowest price this year. Utilities and industrial and basic materials ground out modest gains.

Online juggernaut Amazon said it agreed to pay $42 a share for Whole Foods. Whole Foods had been the target of sale rumors for about two months, and investors wondered Friday if another bidder would step in.

Amazon is a unique threat to many retailers because it doesn’t mind losing money for long stretches. The company might be able to sell inexpensive groceries as it makes its money from its cloud computing business and its gigantic online marketplace.

“Is the future of grocery store shopping going to be a point and click experience, or is it going to be going to a grocery store?” said Dan Morgan, senior portfolio manager at Synovus Trust.

Supermarkets and grocery stores had also plunged Thursday after Kroger cut its annual forecast. Kroger, which dropped 19 percent a day ago, lost another $2.27, or 9.2 percent, and hit a three-year low of $22.29. Sprouts Farmers Market skidded $1.41, or 6.3 percent, to $21.01.

Benchmark U.S. crude rose 28 cents to $44.74 a barrel in New York. Brent crude, used to price international oils, climbed 45 cents, or 1 percent, to $47.37 a barrel in London. Occidental Petroleum jumped $2.43, or 4.1 percent, to $61.83 and Chevron gained $2.02, or 1.9 percent, to $108.35.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.16 percent from 2.17 percent. The yield on the 2-year Treasury note fell to 1.31 percent from 1.35 percent.

Gold rose $1.90 to $1,256.50 an ounce. Silver slipped 6 cents to $16.66 an ounce. Copper stayed at $2.56 a pound.