Wall Street makes gains, Dow ends at record high
NEW YORK - U.S. stocks rose on Wednesday, with the Dow Jones industrial average closing at a record high, boosted by the latest merger news and some strong corporate earnings.
Time Warner Inc shares jumped 17.1 percent to $83.13 and ranked as the S&P 500's best performer after Twenty-First Century Fox confirmed it made an $80 billion takeover offer for the company that was turned down. Twenty-First Century Fox shares fell 6.2 percent to $33.00.
An index of semiconductors shot up 1.1 percent and hit an intraday high of 652.28, its highest since August 2001. The index was led higher by gains in Intel Corp, up 9.3 percent at $34.65. The world's largest chipmaker reported second-quarter results that topped analysts' estimates. Shares of Micron Technologies rose 1.8 percent to $34.64.
The S&P 500 technology index rose 1 percent and ranked among the day's best-performing sectors in the S&P 500.
"We've now come through the earlier stage of the earnings season, and while they (earnings) haven't been stellar, they certainly have been good, with just a few real disappointments," said Rick Meckler, president of LibertyView Capital Management in Jersey City, New Jersey.
"The market held back from moving higher for awhile, but the overall good earnings and M&A deals are giving greater confidence for investors to stay invested."
The Dow Jones industrial average rose 77.52 points or 0.45 percent, to end at 17,138.20. The S&P 500 gained 8.29 points or 0.42 percent, to 1,981.57. The Nasdaq Composite added 9.58 points or 0.22 percent, to 4,425.97.
The Dow's latest milestone surpassed the record it had set on July 3. Earlier Wednesday, the Dow also hit an intraday record high at 17,139.35.
After the bell, eBay Inc reported a 13 percent rise in quarterly revenue and its stock advanced 1.8 percent to $51.61 in extended-hours trading.
During the regular session, a partnership struck between IBM and Apple Inc helped boost the major U.S. stock indexes. IBM will exclusively selliPhones and iPads loaded with applications designed for business clients this fall. IBM shares gained 2.1 percent to $192.36 and gave the Dow its biggest boost, while Apple fell 0.6 percent to $94.78.
S&P 500 companies' profits are now expected to grow 4.8 percent in the second quarter, according to Thomson Reuters data, down from the 8.4 percent growth forecast at the start of April. Revenue is seen up 3.1 percent.
Bank of America lost 1.9 percent to $15.51. The second-largest U.S. bank by assets reported a 43 percent drop in second-quarter profit as mortgage revenue fell and litigation costs increased. The bank also offered $13 billion to settle a probe into mortgage securities it sold, the Wall Street Journal reported.
General Electric Co is in talks to sell its century-old household appliances business for as much as $2.5 billion, Bloomberg reported, citing people familiar with the matter. The stock rose 1.5 percent to $27.02.
Yahoo shares tumbled 5.1 percent to $33.79 a day after the Internet company's disappointing results and outlook, although Yahoo pledged to pay shareholders at least half the proceeds from Alibaba Group Holding Ltd's mega-IPO this fall.
About 6.12 billion shares traded on U.S. exchanges, above the 5.40 billion average for the month to date, according to data from BATS Global Markets.