close
MENU
2 mins to read

While you were sleeping: Time Warner Cable jumps

Margreet Dietz
Wed, 11 Jul 2018

Wall Street moved higher, as a surprise deal for Comcast to buy Time Warner Cable offset a drop in Cisco shares and weaker-than-expected US retail sales and weekly jobless claims.

Shares of Time Warner Cable soared, last up 9.3 percent, after Comcast agreed to buy the cable company. Shares of Comcast were last 4 percent weaker.

"This leaves Comcast as the sole king of the cable hill, with John Malone and Charter hitting a brick wall in their hopes of becoming a close No. 2," Richard Greenfield, an analyst with BTIG, told Bloomberg News. "This is a game changer for Comcast."

In afternoon trading in New York, the Dow Jones Industrial Average rose 0.10 percent, the Standard & Poor's 500 gained 0.17 percent, while the Nasdaq Composite Index added 0.40 percent.

Gains in shares of UnitedHealth, last up 0.9 percent, and those of IBM, last up 0.8 percent, led the Dow higher.

Shares of Cisco posted the largest slide in the Dow, last 3.9 percent weaker. The company predicted sales that fell short of expectations.

The latest US economic data were disappointing. Retail sales unexpectedly dropped 0.4 percent in January, following a revised 0.1 percent decline the previous month. Separately, jobless claims unexpectedly rose, rising by 8,000 to 339,000 in the week ended February 8.

"I don't think we're going to see clean data until probably April, since March is still expected to have bad weather, though not as severe as the winter months," Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut, told Reuters. "Right now markets are still giving the economy the benefit of the doubt."

In other negative surprises, shares of Whole Foods Market dropped, last 7.4 percent weaker, after the company downgraded its 2014 sales forecast for the second time in less than six months.

In Europe, the Stoxx 600 Index slid 0.2 percent, as did the UK's FTSE 100. France's CAC 40 rose 0.2 percent, while Germany's DAX climbed 0.6 percent.

Shares of Rolls-Royce sank 13.6 percent after the company said it expected sales and profit would not increase this year as military budgets are cut in the US and Europe.

"In 2014, we expect a pause in our revenue and profit growth, reflecting offsetting trends across the business," John Rishton, Rolls-Royce chief executive, said in a statement. "This is a pause, not a change in direction, and growth will resume in 2015."

"Our record order book underpins our confidence in the long-term growth of our business," Rishton said.

The company's outlook caught analysts and investors off guard.

"It's clearly shocked the market," Investec analyst Chris Dyett, who cut his profit guidance for Rolls-Royce by about 11 percent, told Reuters. "It's a weaker backdrop than we have factored in previously. It's dragged everything else down."

(BusinessDesk)

Margreet Dietz
Wed, 11 Jul 2018
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
While you were sleeping: Time Warner Cable jumps
35702
false