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20 July 2024

US stocks shake off early weakness to end at records


US stocks edged up to new records Friday, closing a choppy session on a positive note as consumer products stocks gained on Kraft Heinz's interest in buying Unilever.

For the sixth time in seven sessions, all three US stock indices finished at all-time highs, albeit very narrowly in the case of the Dow and S&P 500.

A big gain by Unilever also helped propel the FTSE 100 higher, although Paris dropped and Frankfurt was flat. Leading equity markets in Asia also retreated.

Analysts said some international investors were rattled by President Donald Trump's free-wheeling news conference Thursday, at which he rebutted questions over his relationship with Russia by accusing the media of bias against him.

"The week will be finishing with investors weighing up the likelihood of another Trump Twitter rampage or press conference," said Michael Hewson at CMC Markets.

"Whilst these create great headlines for the media it does little to improve stability in the markets, and many will be wondering whether the honeymoon period is over already."

But other analysts described sentiment as optimistic, in part due to solid US economic data and in part to expectations Trump will succeed in enacting pro-growth measures and tax cuts.

"The real story is that we have had the fourth week in a row that the market has been up," said Art Hogan, chief market strategist at Wunderlich Securities. "The drivers remain intact."

The day's biggest corporate story was Unilever's rejection of the Kraft Heinz bid of $143 billion, followed by a Kraft Heinz statement that it remained interested in pursuing a deal.

Shares of both companies surged, suggesting the market believes the mega-deal in the global food industry could happen. Kraft Heinz jumped 10.6 percent, while Unilever surged 14.0.

Other consumer products stocks also rose on speculation the Kraft Heinz talks could spur other deals. Colgate Palmolive gained 4.3 percent, Kimberly Clark 4.2 percent, and Clorox 2.8 percent.

T-Mobile advanced 5.5 percent and Sprint rose 3.3 percent following a report that Sprint parent SoftBank planned to approach T-Mobile about a merger of the two wireless carriers.