U.S. Stocks End Mixed; Energy Shares Buoy S&P
02/14/2013| 06:56am US/Eastern
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--Stocks close mixed; energy shares lead S&P 500 higher tacking on 0.5%
--DJIA declines, losing nine points as component Cisco declines on earnings
--Euro zone economies contract more than expected, while U.S. sees fewer jobless claims than expected
NEW YORK--Energy shares helped pull the Standard & Poor's 500-stock index higher Thursday, as an improving outlook for the sector sent it higher on a day heavy with merger-and-acquisition activity.
The S&P 500-stock gained one point, or 0.1%, to 1521, and the Nasdaq Composite Index tacked on two points, or 0.1%, to 3199. But the Dow Jones Industrial Average edged down nine points, or 0.1%, to 13973.
Leading the S&P 500, the energy sector gained 0.5%, as drilling and oil-services companies jumped, including Halliburton, which advanced 6.1%, and Nabors Industries, which added 4.4%. Goldman Sachs Group told clients in a note that January marked a turnaround in profitability of energy companies. Elsewhere, coal company Alpha Natural Resources rose after its latest results beat Wall Street expectations. Peabody Energy, another coal miner, gained as well, advancing 4.5%.
Of the prominent M&A deals, H.J. Heinz soared 20% after it agreed to be acquired by an investment group that includes Warren Buffett's Berkshire Hathaway and private-equity firm 3G Capital. Berkshire's Class B shares edged up 1.3%. Fellow food companies Kraft Foods Group, General Mills and Campbell Soup also rose, gaining 0.8%, 3.1% and 1.4%, respectively.
US Airways fell 4.6% after it and AMR, parent of American Airlines, formally announced merger plans that are expected to be completed by the third quarter. US Airways shares had been rising in recent weeks.
Hank Smith, chief investment officer of Radnor, Pa.-based Haverford Trust, was heartened by news of the deals. "There is so much cash [available]; With the lack of fear-inducing headlines, some confidence is starting to emerge" that M&A deals won't fall flat, said Mr. Smith, whose firm oversees $6.5 billion in assets.
In other news, Constellation Brands surged 37% after agreeing with rival Anheuser-Busch InBev on revised terms of A-B InBev's divestiture of Grupo Modelo's U.S. assets. Anheuser-Busch InBev shares climbed 5.9%. And Artio Global Investors jumped 34% after agreeing to be acquired by the U.K.'s Aberdeen Asset Management for $175 million.
In the economy, initial claims for U.S. jobless benefits fell more than expected during the latest week from the previous week.
European markets were broadly lower, with the Stoxx Europe 600 falling 0.2%, after euro-zone gross domestic product in the fourth-quarter contracted more than expected. The German and French economies also shrank by more than expected. Germany's DAX index dropped 1% and France's CAC-40 shed 0.8%. European economic weakness continues to be worrisome, said Mark Luschini, chief investment strategist with Janney Montgomery Scott, which oversees $2.6 billion in its asset-management arm. "I think it put pressure on equity markets here in the U.S."
Asian markets generally rose, as the Bank of Japan left its monetary policy unchanged and said the economy appeared to have stopped weakening. That helped offset data showing Japan's GDP contracted slightly in the fourth quarter, versus expectations of a slight increase.
Crude-oil prices rose 0.3%, to settle at $97.31 a barrel, while gold pulled back 0.6%, to settle at $1,634.70 a troy ounce. The dollar advanced against the euro and edged lower against the yen. The yield on the 10-year U.S. Treasury note fell to 2.000% as prices rose.
In other corporate news, Dow component Cisco Systems fell 0.7% after the networking company reported better-than-expected second-quarter earnings but provided a somewhat downbeat outlook.
General Motors declined 3.2% after the car maker's earnings fell just short of analyst expectations.
PepsiCo gained 1.1% after the beverage and snack company reported better-than-expected fourth-quarter earnings and revenue and boosted its dividend.
Angie's List surged 24% after the reviews-based website reported a fourth-quarter profit, while analysts had anticipated a loss.
Stamps.com slumped 15% after the Web-based postage-services company's fourth-quarter earnings topped estimates but revenue and its 2013 outlook missed forecasts.
Zillow leapt 8.5% after the real-estate website reported a fourth-quarter profit versus expectations of a break-even quarter, along with better-than-expected revenue.
-Write to Alexandra Scaggs at alexandra.scaggs@dowjones.com
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