U.S. stocks recovered from an early slide Monday as gains by technology and media companies outweighed losses by healthcare firms and others.
A report showing U.S. factory orders declined in November weighed on stocks earlier in the day. Concerns about slower economic growth overshadowed a mostly positive January for stocks, with solid corporate earnings helping to offset some of those fears. The wide miss on factory orders could mean more volatility for stocks.
The United States and China ended two days of talks last week in Washington without a deal. Those involved remained optimistic about future meetings, however. Investors hope a deal is reached before a tariffs cease-fire ends March 2, raising costs for companies and consumers.
Clorox and Sysco rose after beating Wall Street forecasts for their most recent quarters. The gains helped lift consumer staples. Troubled pizza chain Papa John’s surged on an infusion of $200 million and a new board chairman.
KEEPING SCORE: The Standard & Poor’s 500 index rose 8 points, or 0.3%, to 2,715 as of 1:13 p.m. EST. The Dow Jones industrial average edged up 38 points, or 0.2%, to 25,101. The Nasdaq composite climbed 65 points, or 0.9%, to 7,329. The Russell 2000 index of smaller companies advanced 10 points, or 0.7%, to 1,512.
FACTORY FLOP: Orders for new U.S. goods fell in November on lower demand for machinery and electrical equipment. The 0.6% drop surprised economists. They had expected a slight increase in orders.
The report is one of many that were delayed by a monthlong partial shutdown of the federal government. The long list of missing indicators makes it difficult to gauge the health of the economy and has prompted a cautious outlook from analysts.
The Commerce Department is expected to release various trade data throughout the week. The Federal Reserve, which was not affected by the shutdown, will release consumer credit data.
SOLID QUARTER: Clorox climbed 6.8% to $160.06 after reporting consensus-beating second-quarter profit. Sysco’s latest quarterly snapshot also topped Wall Street’s forecasts, driving shares in the food distributor up 4.4% to $66.40.
RISING DOUGH: Troubled pizza chain Papa John’s surged 9.3% to $42.08 on news of a $200-million investment from Starboard Value. Starboard Chief Executive Steve Ritchie is also being named chairman at Papa John’s.
Last week, the Louisville, Ky., company’s stock plunged on reports that Trian Fund Management was no longer interested in a deal. The company also had a weak fourth quarter. Founder John Schnatter resigned his CEO and chairman positions last year after a backlash over his comments against NFL protesters and use of a racial slur in a conference call.
PAPER CUTS: Gannett’s stock fell 2.9% to $10.90 after the publisher of USA Today and other newspapers rejected a $1.36-billion buyout from a hedge-fund backed media group with a history of taking over newspapers and slashing jobs. MNG Enterprises, better known as Digital First Media, made its unsolicited bid of $12 per share last month.
Digital First has a reputation for stringent, painful cost-cutting. It is one of the biggest U.S. newspaper chains, with about 200 papers and other publications including the Denver Post, Orange County Register and Los Angeles Daily News. Its biggest shareholder is Alden Global Capital, a New York hedge fund that invests in distressed companies.
Gannett’s board said the offer undervalued the company and wasn’t in the best interests of the company or its shareholders. It was a unanimous vote.
CALLING IN SICK: Healthcare-sector stocks lagged behind the broader market. Allergan slid 5.5% to $138.54. Celgene fell 2.2% to $87.47.
ENERGY: U.S. crude fell 1.4% to $54.50 a barrel in New York. Brent crude, used to price international oils, slipped 0.2% to $62.61 a barrel in London. The lower prices follow a round of supply cuts by OPEC in January and more U.S. sanctions against Venezuela.