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Tags: stocks | grand theft auto | video game | banks

Stocks Tick Upward as Video Game Makers Jump, but Banks Skid

Stocks Tick Upward as Video Game Makers Jump, but Banks Skid
(Source: Rockstar Games)

Wednesday, 08 November 2017 05:30 PM EST

U.S. stock indexes finished with small gains Wednesday as video game makers gave technology companies a boost and household goods companies also rose. However a recent decline in interest rates continued to put pressure on banks.

"Grand Theft Auto" and "NBA2K" maker Take-Two Interactive Software soared after it reported better-than-expected sales, while Activision Blizzard jumped after it said the newest "Call of Duty" game had a strong debut over the weekend. Technology companies rose for the tenth day in a row. Companies that make and sell household goods, like Colgate-Palmolive and Wal-Mart, gained ground as well. Energy companies declined and banks fell again as interest rates have weakened since late October, which makes mortgages and other loans less profitable.

The Standard & Poor's 500 index rose 3.74 points, or 0.1 percent, to 2,594.38. The Dow Jones industrial average gained 6.13 points, or less than 0.1 percent, to 23,563.36. The Nasdaq composite rose 21.34 points, or 0.3 percent, to 6,789.12. All three closed at record highs. The Russell 2000 index of smaller-company stocks picked up 2.64 points, or 0.2 percent, to 1,481.73.

It's now been a year since Donald Trump was elected president in an upset, and the S&P 500 has jumped 21 percent. That's more than stocks have risen after many recent presidential elections, although it trails the market move after Barack Obama was re-elected in 2012. Investors felt stocks would do well under a Trump administration, and so far they have, but there have been some major surprises. The biggest is that stocks in other regions, including Europe, Japan and less developed countries, have done ever better.

"Investors were right to be optimistic post-election, but not because of politics," said Jason Draho, the head of American tactical asset allocation for UBS Wealth Management.

Trump and Congressional Republicans haven't delivered the big infrastructure spending bill Trump proposed while campaigning, and it's not clear if they will be able to pass a tax cut that makes a real difference for the economy. But Draho said stocks keep rising because the global economy is doing so well. The economies of the 35 advanced nations in the Organization for Economic Cooperation and Development are all expected to grow this year, and most are gaining steam. Meanwhile, Trump hasn't had a major effect on international trade agreements, as some investors feared.

"In some ways it's worked out better than investors have hoped," Draho said.

Technology companies have climbed almost 40 percent in the last 12 months including Wednesday's gains. Take-Two jumped after its second-quarter revenue blew past Wall Street's estimates. Analysts said its revenue from online games and digital spending was better than expected. The stock soared $11.26, or 10.6 percent, to $117.65. Activision Blizzard surged $3.59, or 5.9 percent, to $64.44 after it said revenue for "Call of Duty: WWII" topped $500 million in its opening weekend.

Bond prices inched lower. The yield on the 10-year Treasury note rose to 2.33 percent from 2.32 percent. Yields reached a seven-month high in late October but they have slipped since then. Investors expect interest rates to rise a bit more slowly in the future, partly because President Donald Trump named Jay Powell as his choice for Federal Reserve chair last month. Powell is expected to take a similar approach to current Fed Chair Janet Yellen and raise rates at a gradual clip. Some of the other candidates for the job were expected to move faster.

Bank of America fell 39 cents, or 1.4 percent, to $26.79 and Comerica shed $1.02, or 1.3 percent, to $76.14. Still, banks are trading around their highest levels in a decade.

Time Warner Cable slumped after AT&T said it doesn't know when its purchase of the media company will close. Reports from The New York Times, CNN and other outlets, citing unidentified people, said the Justice Department wants to require the companies to sell Turner Broadcasting, which includes CNN, TBS and TNT, or else sell satellite TV provider DirecTV, which AT&T bought in 2015. Time Warner Cable has slumped over the last month as investors wonder if the $85 billion deal will still happen.

On Wednesday Time Warner Cable slid $6.16, or 6.5 percent, to $88.50 and AT&T rose 37 cents, or 1.1 percent, to $33.44.

Benchmark U.S. crude fell 39 cents to $56.81 a barrel in New York. Brent crude, used to price international oils, dipped 20 cents to $63.49 a barrel in London.

Wholesale gasoline rose 1 cent to $1.82 a gallon. Heating oil stayed at $1.92 a gallon. Natural gas picked up 2 cents to $3.18 per 1,000 cubic feet.

Gold rose $7.90 to $1,283.70 an ounce. Silver jumped 20 cents to $17.14 an ounce. Copper rose 1 cent to $3.10 a pound.

The dollar fell to 113.78 yen from 113.87 yen. The euro rose to $1.1596 from $1.1589.

Germany's DAX gained a sliver of a point and the French CAC 40 dropped 0.2 percent. The FTSE 100 index in Britain rose 0.2 percent. In Japan the Nikkei 225 index shed 0.1 percent while Hong Kong's Hang Seng retreated 0.3 percent. The Kospi in South Korea advanced 0.3 percent.

© Copyright 2023 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

U.S. stock indexes finished with small gains Wednesday as video game makers gave technology companies a boost and household goods companies also rose.
stocks, grand theft auto, video game, banks
Wednesday, 08 November 2017 05:30 PM
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