U.S. stock indexes are mixed Thursday afternoon as industrial companies like defense contractor Raytheon fall and health-care stocks including Bristol-Myers Squibb rise.
Bond yields are climbing to their highest levels since May. That’s helping send bank stocks higher, since they’ll earn more from lending as interest rates rise. It’s also sending high-dividend stocks like utilities and real estate companies lower as bonds become more appealing to investors seeking income.
KEEPING SCORE: The Dow Jones Industrial Average gained 26 points, or 0.1 percent, to 18,224 as of 12:29 p.m. Eastern time. The Standard & Poor’s 500 index added 1 point to 2,140. The Nasdaq composite dipped 9 points, or 0.2 percent, to 5,241.
CHIP IN: Smartphone chipmaker Qualcomm said it will buy NXP for $110 per share in cash. Qualcomm jumped $2.80, or 4.1 percent, to $71 and NXP rose $1.31, or 1.3 percent, to $99.97. The deal has been rumored for about a month and investors were excited about the prospect. Qualcomm has climbed 12 percent and NXP is up 22 percent since it was first reported that the companies were in talks.
INDUSTRIALS: Defense contractor Raytheon gave up $4.56, or 3.2 percent, to $136.72 as its outlook failed to impress investors. Communications and surveillance company L-3 Communications gave up $9.92, or 6.7 percent, to $138.79 after it posted weak sales. Aerospace giant Boeing lost $2.37, or 1.6 percent, to $143.17 after it surged almost 5 percent Wednesday. That was its biggest gain since January 2015.
FEELING BETTER: Bristol-Myers Squibb broke out of a slump after it raised its annual forecasts. The stock has fallen by about one-third since early August as investors worried about sales of its cancer treatment Opdivo. Its revenue from Opdivo tripled in the third quarter. The stock rose $3.59, or 7.2 percent, to $52.88.
Biotech drugmaker Celgene also raised its forecasts as sales of its cancer drug maker Revlimid and newer medications kept rising. The stock added $7.16, or 7.3 percent, to $105.57.
BONDS: U.S. government bond prices dropped. The yield on the 10-year Treasury note jumped to 1.85 percent from 1.79 percent a day earlier, its highest yield in almost five months. Financial stocks rose as investors hoped that higher rates would help banks earn more. Bank of America rose 20 cents, or 1.2 percent, to $17.07. High-dividend real-estate companies fell for the second day in a row and are now lower for the year. Utilities also slumped.
START YOUR ENGINES: Tesla Motors rose after it reported its first quarterly profit in three years. The electric car maker also said its revenue more than doubled and that it doesn’t expect it will need to raise cash in the next few quarters. Tesla stock gained $4.90, or 2.4 percent, to $207.14. Also trading higher was SolarCity, a solar panel maker Tesla wants to buy. It rose 77 cents, or 3.9 percent, to $20.76.
RED LIGHT: Automaker Ford said its quarterly profit fell by more than half as it deals with a big recall and a tricky launch of heavy-duty pickups. Its stock sank 12 cents, or 1 percent, to $11.77.
NOT STRONG ENOUGH: Nutritional supplement maker GNC Holdings tumbled again after it reported a smaller profit and weaker sales than investors anticipated. The stock dropped $3.98, or 19.8 percent, to $16.16. The stock is down 48 percent this year.
A DISCOUNT? Online daily deals service Groupon disclosed better results that investors expected, but also said it’s buying competitor LivingSocial. They companies did not announce terms of the deal. Groupon lost 97 cents, or 18.4 percent, to $4.29.
ZTO’s IPO: ZTO Express, an express delivery company in China, went public in the largest IPO of the year so far. The company’s offering of 72.1 million U.S. shares raised $1.4 billion. The stock lost $1.52, or 7.8 percent, to $17.98.
ENERGY: Energy companies traded higher as oil prices recovered after falling for three days in a row. U.S. benchmark crude rose 80 cents, or 1.6 percent, to $49.98 a barrel in New York. Brent crude, the international standard, added 83 cents, or 1.6 percent, to $51.87 a barrel in London.
GOOD AND GREASY: Restaurant chain Buffalo Wild Wings climbed $7.90, or 5.8 percent, to $143 after it reported a profit that lived up to Wall Street’s expectations. The stock has been skidding since early August.
TAKING FLIGHT: Social-media network Twitter added 25 cents, or 1.4 percent, to $17.54 after the company said users grew 3 percent in its latest quarter and said it will cut more than 300 jobs.
CURRENCIES: The dollar rose to 105.15 yen from 104.54 yen. The euro dipped to $1.0904 from $1.0906.
OVERSEAS: Germany’s DAX stock index picked up 0.1 percent and the FTSE 100 in Britain rose 0.4 percent. The French CAC 40 was little changed. Japan’s benchmark Nikkei 225 index slipped 0.3 percent while South Korea’s Kospi rose 0.5 percent and Hong Kong’s Hang Seng lost 0.8 percent.