On The Fly: Top stock stories at midday
Stocks opened in negative territory with the Dow and S&P leading the way lower. The Nasdaq has managed to post a gain as the shares of Microsoft (MSFT) hit an all-time high following its solid earnings report. The Dow has been under pressure thanks in part to shares of General Electric (GE), which are dipping after earnings, and AT&T (T), which is weak after reports that the company may be looking to buy Time Warner (TWX). ECONOMIC NEWS: In the U.S., there were no major economic data releases. In Canada, retail sales fell 0.1% in August. In Europe, Eurozone consumer confidence rose as expected to -8.0 points in October from -8.2 in September. COMPANY NEWS: AT&T is in advanced talks to acquire Time Warner and a deal could be reached as soon as this weekend, according to The Wall Street Journal, citing people familiar with the matter. The Journal's report follows Bloomberg's account yesterday that executives from both companies have met in recent weeks to discuss possible strategies, including a possible merger. Shares of AT&T have slipped over 2.5% after the news, while Time Warner's stock rose more than 10% near midday... Shares of Microsoft gained about 5% near noon after the company reported better than expected quarterly results. The stock, which has hit a new high, is being helped by enthusiasm for progress in its cloud business being expressed by investors and analysts... Conversely, General Electric has dropped about 1.5% after announcing weaker than expected third quarter revenue as slow economic growth continued to weigh, prompting the company to scale back expectations for revenue and profit for the full year... Shares of Reynolds American (RAI) have advanced more than 15% after the company received a non-binding proposal from British American Tobacco (BTI) to purchase the approximately 58% of the former's common stock that the latter does not currently own. MAJOR MOVERS: Among the notable gainers was Alkermes (ALKS), which advanced about 30% after the company said its ALKS 5461 for the treatment of major depressive disorder in patients not helped by standard antidepressants met the main goal in a third late-stage trial. Also higher was PayPal (PYPL), which gained about 8.5% after the company's third quarter revenue beat estimates. Following the earnings release, Stifel analyst Scott Devitt upgraded the stock to Buy, saying the company reported "solid" third quarter results and should deliver "stable consistent, and robust" growth going forward. Additionally, McDonald's (MCD) rose almost 3% after the company posted better than expected quarterly results, helped by the continued popularity of its all-day breakfast. Among the noteworthy losers was Skechers (SKX), which slipped more than 17% after its missed third quarter earnings and guidance. Following the announcement Citi analyst Corinna Van der Ghinst downgraded the stock to Neutral, saying visibility over the next 12 months is "challenging." Also lower was MGP Ingredients (MGPI), which slid about 6% after the Kansas City Star and other local news outlets reported that the company's plant in Atchison, Kansas had suffered a chemical spill that prompted people to be told to avoid the area. INDEXES: Near midday, the Dow was down 37.32, or 0.21%, to 18,125.03, the Nasdaq was up 10.46, or 0.20%, to 5,252.29, and the S&P 500 was down 2.69, or 0.13%, to 2,138.65.