US stock indexes turn mixed after morning burst fades away
NEW YORK (AP) — U.S. stock indexes were mixed in early afternoon trading on Monday after a morning burst of buying faded away.
The S&P 500 jumped at the open of trading following a series of buyout deals and strong earnings reports. But the index sagged as noon approached, weighed down by losses for telecom stocks and other areas of the market.
The Dow Jones industrial average was still holding onto its gains, driven by a big jump for McDonald’s following its surprisingly strong profit report.
KEEPING SCORE: The S&P 500 was down 5 points, or 0.2 percent, at 2,665, as of 12:27 p.m. Eastern time. It had been up as much as 0.5 percent earlier in the morning.
The Dow Jones industrial average climbed 57, or 0.2 percent, to 24,368, and the Nasdaq composite sank 32, or 0.5 percent, to 7,087.
PUT ON HOLD: Telecom stocks in the S&P 500 fell 1.2 percent for the largest loss among the 11 sectors that make up the index.
Sprint and T-Mobile US were at the center of investors’ attention, though neither is in the S&P 500. The pair announced a $26.5 billion deal to merge following years of consideration for a combination. But investors are unsure whether this attempt will get the necessary approvals from U.S. regulators.
Sprint dropped 14.8 percent to $5.54, and T-Mobile lost 7.1 percent to $59.96.
GOBBLED UP: McDonald’s jumped 5.1 percent to $166.40 after it reported healthier profit and revenue than analysts expected for the first three months of the year. Sales at its restaurants open more than a year were much stronger than Wall Street had forecast.
EARNING THEIR KEEP: McDonald’s joined the wave of companies to report not only big earnings growth for the first quarter, but bigger than analysts expected. Just over half the companies in the S&P 500 have reported their earnings for the first three months of the year, and they’re on pace to deliver overall growth of 23 percent, according to FactSet. That would be the strongest showing since the summer of 2010.