Stocks rose on Thursday as sentiment on Wall Street was lifted by economic data that blew past expectations and dealmaking activity in the media sector.
The Dow Jones industrial average climbed 100 points, with Disney as the best-performing stock in the index. The S&P 500 gained 0.3 percent, as the telecommunications sector led nine of 11 sectors higher. The Nasdaq composite outperformed, rising 0.5 percent.
The Commerce Department said retail sales rose 0.8 percent in May, well above a Reuters estimate of 0.4 percent. That also marked the biggest gain in retail sales since November. In the premarket, stock futures added to their gains following the data’s release.
“After a mediocre start to the year, … consumer spending in Q2 has definitely improved,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “Consumers are seeing the tax cuts in their paychecks and higher wages which is helping to offset a rising cost of living.”
The Labor Department also reported that weekly jobless claims fell to a near 44½-year-low last week, pointing to a tightening jobs market.
Investors also cheered dealmaking news, as shares of 21st Century Fox rose 1.5 percent after NBCUniversal-parent Comcast announced a bid to buy several major units of the media giant for $65 billion. Comcast’s bid tops Disney’s, who agreed to a $52.4 billion deal. Comcast shares rose 4 percent while Disney gained 1.6 percent.
“I think this is really their opportunity recreating a company that looks like Disney,” said Rich Greenfield, an analyst at BTIG, on CNBC’s “Squawk Box.”
Comcast CEO “Brian Roberts was sort of embarrassed when Comcast tried to buy Disney [in 2004]. That was a very difficult time for Comcast. … In 2015, Disney was one of the lead complainers about stopping the Comcast acquisition of Time Warner Cable, another loss for Brian. I just don’t think Brian will lose a third time,” Greenfield said.
The news comes a day after a judge approved AT&T’s acquisition of Time Warner. Last year, the Justice Department sued to block the merger, arguing it would potentially lead to higher prices for the consumer. AT&T shares rose 0.8 percent, while Time Warner gained 0.8 percent.
Thursday’s moves come after U.S. stocks closed lower after the Federal Reserve announced Wednesday a new rate hike and indicated that two other increases are possible until the end of the year. As a result, the Dow fell about 120 points as traders expect that the higher rates will bring higher costs for companies.
The European Central Bank, meanwhile, said Thursday it will likely end its massive bond-buying program in December.