Stocks off to quiet start as oil price surge slows


NEW YORK (AP) — U.S. stocks are wavering between small gains and losses early Thursday as as a slide in health care and high-dividend stocks offsets gains in energy and materials companies. PepsiCo and ConAgra Foods are rising after strong quarterly earnings reports. Oil prices are little changed after a big surge a day ago, but companies that drill for oil are climbing.

KEEPING SCORE: The Dow Jones industrial average was little changed at 18,338 as of 10:40 a.m. Eastern time. The Standard & Poor’s 500 index was also flat at 2,169. The Nasdaq composite fell 18 points, or 0.4 percent, to 5,299.

REFRESHING: PepsiCo climbed after the company reported strong third-quarter results and raised its annual forecasts. While soda consumption in the U.S. has been falling, PepsiCo said it sold more drinks and Frito-Lay snacks in North America. Its stock gained $1.87, or 1.7 percent, to $109.25.

THANK GOODNESS: ConAgra Foods rose after its profit surpassed analysts’ forecasts. The company has sold off several brands to focus on product lines like Chef Boyardee and Hebrew National, and it’s getting ready to split into two companies. ConAgra stock rose $3.17, or 7.3 percent, to $46.27.

OIL PRICES: Oil prices were little changed Thursday morning after a 5 percent surge the day before. Energy prices had jumped after the nations of OPEC, which collectively produce more than third of the world’s oil, agreed to a small cut in production. The decision was a surprise, but something investors had long hoped for. The deal won’t be finalized until November.

U.S. crude picked up 8 cents to $47.13 a barrel in New York. Brent crude, the international benchmark, was flat at $49.22 a barrel in London.

GUSHER: Companies that drill for oil rose sharply as investors expected them to benefit from higher prices for crude. Devon Energy added $1.57, or 3.8 percent, to $37.30. Companies that provide rigs and other equipment to drillers also rose as investors expected that higher prices will encourage more drilling. Helmrich & Payne rose $3.86, or 6 percent, to $66.67. Energy giants like Chevron and Exxon Mobil, which are involved in processing oil as well as drilling, didn’t move as much.

CELL OFF: Intra-Cellular Therapeutics plunged $26.86, or 63.4 percent, to $15.49. The drug developer said an experimental schizophrenia treatment failed in a late-stage clinical trial, as the drug did not work any better than a placebo.

REUNITED? Media companies CBS and Viacom rose after Sumner Redstone’s National Amusements, which controls both companies, said it wants them to combine again. CBS and Viacom had merged in 1999 and split up in 2005. Viacom rose 99 cents, or 2.7 percent, to $37.54 and CBS rose 66 cents, or 1.2 percent, to $54.78.

BONDS: Bond prices fell. The yield on the 10-year Treasury note rose to 1.58 percent from 1.57 percent. Stocks that pay big dividends lagged the market Thursday, with real estate and utility companies taking some of the largest losses.

FOREIGN MARKETS: News of the potential cut in oil production lifted stocks overseas. Britain’s FTSE 100 climbed 1.2 percent and the CAC 40 in France rose 0.9 percent. Germany’s DAX advanced 0.5 percent. Japan’s benchmark Nikkei 225 index jumped 1.4 percent and in South Korea the Kospi advanced 0.8 percent. Hong Kong’s Hang Seng rose 0.5 percent.

CURRENCIES: The dollar rose to 101.58 yen from 100.75 yen. The euro edged up to $1.1221 from $1.1214.

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at http://bigstory.ap.org/journalist/marley-jay

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