NEW YORK -- U.S. stocks rose Wednesday as investors bet that technology companies and small, domestically focused firms will continue to do well even if the trade dispute between the U.S. and China gets worse. Media companies jumped after Disney reached a new deal with 21st Century Fox.
The S&P 500 index rose 4.73 points, or 0.2 percent, to 2,767.32. The Nasdaq composite gained 55.93 points, or 0.7 percent, to 7,781.51. The Russell 2000 index of smaller-company stocks added 13.54 points, or 0.8 percent, to 1,706.99, also closing at a record high.
But the Dow industrials slipped 42.41 points, or 0.2 percent, to 24,657.80. The Dow has fallen for seven days in a row, its worst streak in more than a year, although the losses have been fairly small.
Facebook, Microsoft and Alphabet led the rally in technology companies as the Nasdaq composite topped the all-time high it set last week. Disney sweetened its deal to buy Fox's entertainment businesses to $71.3 billion, topping an offer from Comcast earlier this month. Other media companies like Netflix and Viacom climbed as investors hoped more deals will follow.
General Electric dipped after the announcement that GE will be removed from the Dow next week, ending a 110-year stint. Shares of Walgreens, its replacement, surged.
Sameer Samana, global equity and technical strategist for the Wells Fargo Investment Institute, said investors aren't sure what to make of the administration's mix of harsh pronouncements and conciliatory statements. While the market has taken some sharp drops during the trade dispute, he said Wall Street usually comes back to the fact that the global economy, and especially the U.S. economy, is doing well.
"For the most part things are pretty good from an economic and fundamental standpoint," he said. Samana added that technology companies have often led the way when the market recovers from trade-related slumps because of their strong earnings, and because China's government can't put tariffs on too many U.S. technology companies because it is trying to build up its own technology sector.
Markets have been on edge with the U.S. and China announcing tariffs on each other's imports and threatening more. While global stocks fell Tuesday, the S&P 500 finished with a loss of just 0.4 percent as investors decided that many U.S. industries don't face a major threat from the proposals and that negotiations might take some of the sting out of the proposed taxes.
21st Century Fox jumped again after it accepted Disney's latest offer. It said yes to a $52.4 billion bid from Disney in December before Comcast offered $65 billion in cash, and some experts think Comcast will raise its offer again. Fox surged 7.5 percent to $48.08 while Disney added 1 percent to $107.15 and Comcast climbed 1.8 percent to $33.39.
Starbucks sank 9.1 percent to $52.22 after a weak sales forecast. 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 U.S. business. Other restaurant chains also struggled, and Dow component McDonald's lost 1.5 percent to $162.56.
GE slipped 0.5 percent to $12.88. Walgreens, which replaces GE in the Dow on Tuesday, jumped 5.2 percent to $68.
Business on 06/21/2018