Wall Street ticks up, lifted by Verizon, chipmakers
Federated chief equity strategist Phil Orlando discusses why investors shouldn’t bet on media companies in today's market.
U.S. stocks rose on Monday, with Verizon boosting the telecoms sector after the stock got an upgrade, while a deal in semiconductors lifted high-performing tech shares.
With no major earnings or economic data scheduled this week, trading volumes were thin and expected to get even quieter leading up to the Thanksgiving holiday on Thursday and an early market close on Friday.
Overall trading volume was the lightest in a month.
Verizon (NYSE:VZ) boosted the telecom services sector of the S&P 500 with a 1.7 percent advance to $46.20 after a Wells Fargo note highlighted the stock’s valuation and said it is “an attractive yield play.”
Telecoms .SPLRCL are down 17 percent this year, compared with a 15 percent advance on the S&P 500.
“There’s a bounce in telecoms, which have been the worst group so far this year,” said Eric Kuby, chief investment officer at North Star Investment Management Corp in Chicago.
“There’s always a chance that something disrupts the apple cart, but there’s very little news and a lot of people focusing on the football games and the turkey dinner,” he said, referring to the staples of the U.S. Thanksgiving holiday.
Cavium (NASDAQ:CAVM) touched a record high of $84.41 after larger rival Marvell (NASDAQ:MRVL) said it would buy the company for about $6 billion. Cavium shares were last up 10.8 percent at $84.02 and Marvell shares rose 6.4 percent to $21.59.
The semiconductor index .SOX rose 1.2 percent and touched its highest level since the highs of the Y2K bubble.
The Dow Jones Industrial Average rose 72.09 points, or 0.31 percent, to 23,430.33, the S&P 500 gained 3.29 points, or 0.13 percent, to 2,582.14 and the Nasdaq Composite added 7.92 points, or 0.12 percent, to 6,790.71.
Small cap stocks on the Russell 2000 rose 0.7 percent, outperforming the large-cap indexes.
Time Warner Inc (NYSE:TWX) shares slid after reports the U.S. Justice Department will sue to prevent AT&T (NYSE:T) from buying Time Warner.
Time Warner ended down 1.1 percent at $87.71.
Health stocks .SPXHC were weighed by a 2.0-percent drop in Merck (NYSE:MRK) to $54.10 and a 0.8 percent fall in Bristol-Myers (NYSE:BMY) after Roche announced positive trial results for a competing cancer drug.
Advancing issues outnumbered declining ones on the NYSE by a 1.50-to-1 ratio; on Nasdaq, a 1.54-to-1 ratio favored advancers.
The S&P 500 posted 42 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 129 new highs and 28 new lows.
About 5.67 billion shares changed hands in U.S. exchanges, far below the 6.81 billion daily average over the last 20 sessions and the lightest since Oct. 18.