US open: Merger speculation sends telecoms names higher

Stocks were holding slightly higher ahead as investors listened in on a speech by the American president to the United Nations's general assembly and ahead of the US Federal Reserve's policy decision the next day.

As of 1505 BST, the Dow Jones Industrials was higher by 0.09% or 23.75 points to 22,359.33, alongside a gain of 0.07% or 1.80 points for the S & P 500 to 2,506.01 and an advance of 0.06% or 3.97 points to 6,458.04 on the Nasdaq Composite.

Giving sentiment a boost, a CNBC report reignited speculation of a potential merger between Sprint and T-Mobile, lighting a fire under the entire telecoms space.

Against that backdrop, the best performing areas of the market were: Mobile Telecommunications (4.11%), Telecommunications (1.87%) and Non-ferrous metals (1.80%). Aerospace & Defence was also higher, gaining 1.39%.

In the background, in a speech at the UN's New York headquarters US president Donald Trump told the General Assembly "much more" needed to be done on North Korea and labelled Tehran a "murderous regime".

Looking out to the next session, following their two days of meetings rate-setters at the US central bank were expected to announce the start of their balance sheet tapering, which many analysts appeared to believe would go largely unnoticed because it had been clearly 'telegraphed' for some time now.

However, there was slight uncertainty about by just how much the Fed would adjust its guidance for interest rate increases over the next two years, although quite a few analysts appeared to be rather skeptical that it would be able to raise the Fed funds rate by more than twice or thrice by year-end 2018.

On a related note, perhaps, Jim Reid at Deutsche Bank told clients: "there are a number of areas of the global financial system that look at extreme levels. This includes valuations in many asset classes, the unique size of central bank balance sheets, sky high debt levels, ultra-low interest rates and even the level of potentially game-changing populist political support around the globe.

"If there is a crisis relatively soon (within the next 2-3 years), it would be hard to look at these variables and say that there was no way of spotting them in advance."

Economic data on Tuesday came in mixed, with US housing starts printing at an annualised pace of 1.18m for August, according to the Department of Commerce, as economists correctly forecast.

Meanwhile, according to the Bureau of Economic Analysis over the three months to June the country's shortfall on its current account deficit grew from -$113.5bn one year ago to -$123.1bn (consensus: -$110.5bn).

In other corporate news, Toys R' Us vied with telecoms shares for investors' attention after the toy retailer succumbed to pressure from its digital rivals, forcing it to file for Chapter 11.

The news was also dragging down rivals such as Mattel.

In parallel, Walgreen's announced plans to buy 1,932 establishments and three distribution centres from rival Rite Aid for $4.38bn.

Post Holdings was also in the headlines after disclosing it would buy Bob Evans Farms's equity for roughly $1.5bn.

Shares in AutoZone were also likely to find a bid after posting better-than-expected top and bottom line figures for its fiscal fourth quarter.

Dow Jones - Risers

Verizon Communications Inc. (VZ) $49.12 2.14%
American Express Co. (AXP) $88.54 0.76%
Intel Corp. (INTC) $37.24 0.65%
Procter & Gamble Co. (PG) $93.73 0.63%
Chevron Corp. (CVX) $115.91 0.63%
Goldman Sachs Group Inc. (GS) $228.94 0.62%
Caterpillar Inc. (CAT) $124.47 0.52%
United Technologies Corp. (UTX) $113.26 0.43%
JP Morgan Chase & Co. (JPM) $93.30 0.41%
Apple Inc. (AAPL) $159.10 0.27%

Dow Jones - Fallers

Unitedhealth Group Inc. (UNH) $196.55 -0.83%
Nike Inc. (NKE) $53.21 -0.54%
Johnson & Johnson (JNJ) $134.76 -0.46%
Merck & Co. Inc. (MRK) $65.77 -0.33%
General Electric Co. (GE) $24.39 -0.29%
Coca-Cola Co. (KO) $46.01 -0.22%
Pfizer Inc. (PFE) $35.47 -0.21%
3M Co. (MMM) $213.52 -0.11%
Boeing Co. (BA) $252.82 -0.10%
International Business Machines Corp. (IBM) $144.54 -0.01%

S&P 500 - Risers

Kohls Corp. (KSS) $46.86 4.39%
Leucadia National Corp. (LUK) $24.22 3.62%
Mattel Inc. (MAT) $15.38 3.43%
Hasbro Inc (HAS) $96.24 3.22%
NetApp Inc. (NTAP) $41.89 3.10%
Progressive Corp. (PGR) $47.56 2.70%
CF Industries Holdings Inc. (CF) $36.00 2.56%
Verizon Communications Inc. (VZ) $49.12 2.14%
Gap Inc. (GPS) $28.49 2.11%
Wynn Resorts Ltd. (WYNN) $146.40 1.78%

S&P 500 - Fallers

Best Buy Co. Inc. (BBY) $53.07 -7.46%
Centene Corp. (CNC) $89.91 -4.94%
Seagate Technology Plc (STX) $31.93 -4.74%
Sealed Air Corp. (SEE) $41.71 -2.75%
Crown Castle International (CCI) $101.82 -2.56%
Kellogg Co. (K) $66.87 -2.54%
AutoZone Inc. (AZO) $550.40 -2.31%
American Tower Corp (Reit) (AMT) $141.54 -2.23%
Advance Auto Parts (AAP) $96.70 -1.91%
Signet Jewelers Ltd (SIG) $66.25 -1.85%

Nasdaq 100 - Risers

T-Mobile Us, Inc. (TMUS) $63.94 3.46%
Mattel Inc. (MAT) $15.38 3.43%
Hasbro Inc (HAS) $96.24 3.22%
Wynn Resorts Ltd. (WYNN) $146.40 1.78%
KLA-Tencor Corp. (KLAC) $102.59 1.66%
Liberty Global plc Series A (LBTYA) $33.64 1.57%
Liberty Global plc Series C (LBTYK) $32.78 1.52%
Micron Technology Inc. (MU) $35.82 1.10%
Paypal Holdings Inc (PYPL) $63.52 0.95%
Vodafone Group Plc ADS (VOD) $28.88 0.91%

Nasdaq 100 - Fallers

Seagate Technology Plc (STX) $31.93 -4.74%
Walgreens Boots Alliance, Inc. (WBA) $81.01 -1.92%
Tesla Inc (TSLA) $377.81 -1.87%
Western Digital Corp. (WDC) $87.53 -1.85%
O'Reilly Automotive Inc. (ORLY) $206.44 -1.73%
NetEase Inc. Ads (NTES) $288.32 -1.70%
Expedia Inc. (EXPE) $139.93 -1.57%
Henry Schein Inc. (HSIC) $79.70 -1.48%
Regeneron Pharmaceuticals Inc. (REGN) $429.25 -1.24%
Mercadolibre Inc. (MELI) $286.14 -1.23%