After struggling early on, Wall Street punched its way into positive territory on Wednesday despite trouble overseas.
The Dow, S&P 500 and Nasdaq all posed modest gains heading into lunchtime.
Retreat mode?: Just a few weeks ago the S&P 500 appeared to be on a path to break through the 2,000 mark for the first time ever. Now the index of U.S. stocks is having trouble keeping its head above 1,900. Similarly, the Dow, which crossed 17,000 for the first time in early July, is now around 16,400.
Stocks dropped Tuesday with much of the retreat blamed on renewed concerns about geopolitical tensions with Russia. The Dow plummeted 140 points and remains in the red on the year.
The fear on Wall Street has sent cash flooding into the safe haven bond markets. Treasury prices rallied, leaving the yield on the 10-year note briefly below 2.45% and flirting with its lowest levels of the year.
Sea of red overseas: European markets tumbled overnight amid fresh evidence of the pain being inflicted by the crisis in Ukraine and slow growth in general. But the major indexes trimmed their losses in recent action.
Germany’s Dax index fell almost 1% before rebounding somewhat as a new report showed factory orders unexpectedly fell 3.2% in June. The government blamed “geopolitical developments and risks” for the slump.
Italy’s stock market dropped 2% on new data revealing the country’s economic fall back into contraction mode during the second quarter.
“Global markets are in churn and burn mode this morning as European data has drastically under-delivered and the specter of conflict in the Ukraine hangs dark over the continent,” analysts at Bespoke Investment Group wrote in a note to clients.
Meanwhile, nearly all Asian markets ended the day with losses. Japan’s Nikkei fell 1% Wednesday — leading the index to a full 3.1% drop over the last five trading days. China stocks were steadier, as they continue to bounce back from first half losses.
M&A winners and losers: Shares of Walgreens plummeted 12.5% after the company confirmed it’s taking full control of the U.K.’s Alliance Boots but will not move headquarters out of the U.S. That news disappointed investors, who hoped the pharmacy chain would shift its base to the U.K. to save money on taxes in a controversial deal known as an inversion.
Time Warner plunged 12% after Rupert Murdoch’s 21st Century Fox announced it has given up on pursuing a takeover of the owner of TBS, TNT and CNNMoney. Time Warner shares surged in July when Murdoch’s $80 billion bid first hit the headlines.
Time Warner shares remained under heavy sell pressure even after logging earnings that crushed expectations amid continued HBO strength. Fox, which is set to report after the close, rallied 5% on the deal news and new share buyback.
A tie-up between Sprint and T-Mobile is also now off the table. Shares of both companies tumbled on the news. That could leave French telecom company Iliad as the frontrunner to buy T-Mobile. Iliad shares were down 4% in Paris.
Notable movers — Groupon, Disney, Bank of America: Groupon investors are holding a fire sale. The daily deals site plummeted 16.5% after alarming investors with a wider quarterly loss than expected and a gloomy outlook for the rest of the summer.
It wasn’t exactly a day at the Magic Kingdom for Walt Disney shareholders. Shares of the entertainment giant flatlined as stronger-than-expected earnings were countered by higher costs at cash-cow ESPN.
On a more positive note, AOL popped 9% as Wall Street cheered a 12% jump in second-quarter revenue that easily beat expectations.
Investors also chugged shares of Molson Coors Brewing. The brewer sold less beer during the second quarter but grew profits by hiking prices.
Shares of Activision Blizzard marched 2.5% higher as the maker of “Call of Duty” and other video games posted earnings that exceeded forecasts.
Bank of America ticked 1.5% higher after the Federal Reserve gave a green light to the bank’s plan to boost its dividend. The approval follows an embarrassing math error by BofA.
Keurig Green Mountain rallied 1.5% ahead of its earnings report, which is due after the closing bell.
