US stocks rise as trade fears ebb and tech stocks lead

US stocks rise as trade fears ebb and tech stocks lead
The Associated Press

NEW YORK (AP) — U.S. stocks are rising Wednesday, led by technology and media companies, as global markets let go of some of their fears about the growing trade dispute between the U.S. and China. Twenty-First Century Fox is jumping after Disney agreed to buy Fox’s entertainment businesses for more than $71.3 billion, topping an offer from Comcast. Investors are hoping that will be followed by other deals. Walgreens rose after it was added to the Dow Jones industrial average, where it will replace General Electric next week.

KEEPING SCORE: The S&P 500 index rose 11 points, or 0.4 percent, to 2,773 as of 1 p.m. Eastern time. The Dow Jones industrial average added 7 points to 24,707. It’s fallen for each of the last six days as the trade turbulence hurt industrial and materials companies, which do a lot of businesses outside the U.S. The Nasdaq composite gained 74 points, or 1 percent, to 7,800, which put it on track for a record high. The Russell 2000 index of smaller-company stocks added 13 points, or 0.8 percent, to 1,707 after it closed at another record high Tuesday.

Markets have been on edge with the U.S. and China imposing tit-for-tat tariffs on each other’s imports and threatening more. Global stocks fell Tuesday, although in the U.S. the S&P 500 finished with a loss of just 0.4 percent after falling more than 1 percent at one point. While President Donald Trump threatened to put new tariffs on as much as $400 billion in imports from China and China threatened to retaliate, investors decided that many industries don’t face a major threat from the proposals and that smaller, more U.S.-focused companies are likely to keep doing well.

Both countries plan to put tariffs on about $50 billion in imports in early July, which still leaves them with several weeks to negotiate.

SEQUEL: Twenty-First Century Fox jumped again after it accepted a new offer from Disney that values Fox’s entertainment and international businesses at more than $70 billion in cash and stock. Fox accepted a $52.4 billion bid from Disney in December before Comcast offered to buy those businesses for $65 billion in cash. Some experts think Comcast will raise its offer again. Fox surged 7.5 percent to $48 while Disney dipped 0.1 percent to $105.97. Comcast fell 0.9 percent to $32.50.

Other media companies rose as well. Viacom added 2.6 percent to $30.08 and Netflix jumped 3 percent to $417.26.

DOW AND OUT: General Electric is coming out of the Dow Jones industrial average after more than a century and it will be replaced by Walgreens Boots Alliance on Tuesday. GE was part of the Dow when the index was created 1896 and it’s the last component that remains an independent publicly traded company.

GE is by far the least expensive Dow stock in terms of share price, which is how the Dow is weighted. GE slipped 0.4 percent to $12.90 Wednesday along as industrial companies traded lower. Walgreens jumped 5 percent to $67.82.

For years GE has been struggling in critical markets and selling off businesses. It’s also given some weak forecasts and early this year said the Securities and Exchange Commission was investigating the company over a $15 billion hit taken to cover miscalculations made within an insurance unit. Adjusted for inflation, GE was worth around $860 billion in mid-2000, but it’s worth about $112 billion now, including a drop of more than 50 percent over the last 12 months.

BITTER TASTE: Starbucks sank 9.5 percent to $51.98 as it said it’s having trouble in both the U.S. and China. The company’s forecast for sales growth in the third quarter is well below what it had projected and what analysts were anticipating. Starbucks said it didn’t do as many transactions in China as it expected, and the controversy that followed the arrest of two black men at a Philadelphia store temporarily slowed its business.

DIDN’T SEE IT COMING: Oracle lost 7.7 percent to $42.71. The software maker had a solid fiscal fourth quarter, but investors were concerned about its forecasts for the current quarter.

ENERGY: Oil futures climbed ahead of Friday’s OPEC meeting, where most experts think the group will increase production. As a result of that view, crude prices have dropped over the last few weeks. Benchmark U.S. crude rose 0.4 percent to $65.34 a barrel in New York. Brent crude, the international standard for oil prices, lost 1.1 percent to $74.26 a barrel in London.

BONDS: Bond prices inched lower. The yield on the 10-year Treasury note rose to 2.92 percent from 2.90 percent.

CURRENCIES: The dollar edged up to 110.22 yen from 110.07 yen. The euro rose to $1.1588 from $1.1575.

OVERSEAS: The FTSE 100 in Britain jumped 0.3 percent and Germany’s DAX was up 0.1 percent. France’s CAC 40 lost 0.3 percent. After sharp losses the day before, Japan’s benchmark Nikkei 225 index rebounded 1.2 percent and South Korea’s Kospi gained 1 percent. Hong Kong’s Hang Seng rose 0.8 percent.

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at https://apnews.com/search/marley%20jay

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