December 18, 2014
Wall Street near flat as deal news offsets data
US stocks ended nearly flat today as the latest deal news offset losses following discouraging data on the housing market and some signs of weakness in the services sector.
Dollar Tree Inc offered to buy rival discount chain Family Dollar Stores Inc for about $8.5 billion. The transaction, including debt, values Family Dollar at about $9.2 billion. Family Dollar's stock shot up 24.9 percent to $75.74 and was the S&P 500's biggest percentage gainer. Dollar Tree's shares gained 1.2 percent to $54.87.
Zillow Inc agreed to buy Trulia Inc for $3.5 billion in stock in a deal that would combine the two most popular US real estate website operators Trulia's shares jumped 15.4 percent to $65.04. Zillow's stock rose 0.9 percent to $160.32.
Investors' optimism, however, was limited by the day's data, among the latest to suggest that momentum in some sectors of the economy was slowing.
An index of pending home sales unexpectedly fell 1.1 percent in June, the National Association of Realtors said. The report followed an 8.1 percent drop of new home sales in June, the biggest slump in almost a year. The PHLX housing sector index declined 1.4 percent.
The Dow Jones industrial average rose 22.02 points or 0.13 percent, to end at 16,982.59. The S&P 500 inched up just 0.57 of a point or 0.03 percent to close at 1,978.91. The Nasdaq Composite, though, slipped 4.66 points or 0.10 percent, to finish at 4,444.91.
European stocks traded down, after weak data from the US and the possibility of new economic sanctions on Russia overshadowing strong earnings updates from firms like Ryanair and spin-off talk from Reckitt Benckiser.
European equities have barely budged from their levels at the end of June, holding back from new multi-year highs on doubts over the pace of economic recovery in the euro zone and the impact of conflicts in Ukraine and across the Middle East.
The pan-European FTSEurofirst 300 index closed down 0.2 percent at 1,369.61 points, while the euro zone's blue-chip Euro STOXX 50 index fell 0.1 percent.
Airline Ryanair and consumer-goods group Reckitt Benckiser were among the outperformers, up 2 to 4 percent after a blowout quarter for the airline led it to raise its profit forecast and after Reckitt said it planned to sell its heroin-addiction treatment, worth $4.9 billion by some measures.
France's Danone was also among the top gainers, up 1.1 percent following a report that the food and beverage major is in talks to sell its medical nutrition business to U.S. group Hospira in a deal valuing the unit at about $5 billion, or 3.7 billion euros.
On the downside, German automakers Daimler and Porsche - as well as Austrian lender Raiffeisen Bank - were down over 2 percent. Banking-technology group Wincor Nixdorf also sank as much as 11 percent after it slashed its sales forecast.
Meanwhile, the Nikkei share average hit a six-month closing high, buoyed by hopes for improvement in domestic corporate earnings, while casino-related plays outperformed on a media report that new casinos could be opened in Japan before the 2020 Summer Olympics.
The benchmark Nikkei gained 0.5 percent to 15,529.40 points, its highest closing level since Jan. 23.
Since mid-June, the index has tried a few times to rise above the 15,500 level but in vain. Still, the Nikkei is down 4.7 percent since the start of this year. The broader Topix advanced 0.4 percent to 1,286.07 in light trade, while the JPX-Nikkei Index 400 added 0.3 percent to 11,710.58.