The News Herald (Willoughby, OH)
Stocks rebound; technology rally leads Nasdaq to record high
NEW YORK » Technology companies soared Thursday as major U.S. stock indexes recovered the ground they lost a day earlier. The Nasdaq composite closed at another all-time high.
Big names like Apple and Microsoft and chipmakers including Intel all made big gains as investors remain optimistic about the technology sector even though much of the market has been shaken by escalating tensions between the U.S. and its trading partners, especially China.
Banks will begin reporting their second-quarter results Friday morning. Investors expect another round of strong profit growth for the whole market, but they’re especially optimistic about technology companies. They will announce their earnings later this month.
“Tech has been there for them through all of these ups and downs,” said Karyn Cavanaugh, senior markets strategist at Voya Investment Management. “They’re a good wingman for investors, and that’s why investors are sticking with them.”
The S&P 500 index rise 24.27 points, or 0.9 percent, to 2,798.29. The Dow Jones Industrial Average rose 224.44 points, or 0.9 percent, to 24,924.89.
The Nasdaq jumped 107.30 points, or 1.4 percent, to 7,823.92. Its last record came on June 20.
The Russell 2000 index of smaller-company stocks added 6.61 points, or 0.4 percent, to 1,690.28.
Industrial companies also regained much of the ground they lost Wednesday, but energy companies and basic materials makers failed to rally. Defense contractors climbed after President Donald Trump advocated for more defense spending in the U.S. and Europe.
Several European leaders said NATO spending plans haven’t changed.
Software maker CA made the biggest gain in the technology sector soared after it accepted an offer from Broadcom worth $18.9 billion, or $44.50 per share. Its stock rocketed 18.7 percent to $44.15. Broadcom investors expressed their disapproval of the deal, which involves Broadcom taking on $18 billion in debt. The stock dropped 13.7 percent to $209.98.
Broadcom’s market value fell by $14.4 billion.
The merry-go-round of potential media deals continued as Comcast offered to buy European pay-TV company Sky for $34 billion a day after Twenty-First Century Fox increased its own offer for Sky.
Fox already owns part of Sky, and while it tangles with Comcast, Comcast and Disney are also trying to buy Fox itself. Fox recently accepted Disney’s $71 billion offer. The New York Times reported Thursday that Comcast will focus on Sky and end its pursuit of Fox.
Sky’s stock rose 3.4 percent in London. In the U.S., Comcast rose 2.3 percent to $34.55 and Fox fell 0.9 percent to $47.38. Disney gained 0.2 percent to $108.25.
CVS Health rose 1 percent to $67.99 and Aetna gained 1.9 percent to $191.09 after Bloomberg News reported that the Department of Justice won’t try to stop CVS from buying Aetna. AT&T fell 1.3 percent in aftermarket trading after the Justice Department appealed a court ruling that allowed AT&T to buy Time Warner.