U.S. stocks were little changed, after erasing earlier losses, as a drop in jobless claims and Warren Buffett’s deal for H.J. Heinz Co. tempered concern over shrinking economies in Europe and Japan.
Heinz surged 20 percent after Buffett’s Berkshire Hathaway Inc. and 3G Capital agreed to buy the company in a deal valued at about $23 billion. Constellation Brands Inc. soared 38% after Anheuser-Busch InBev NV offered to cede full control of U.S. distribution for Corona beer in a bid to salvage its deal for Grupo Modelo. US Airways Group Inc. dropped 8.5% after agreeing to an $11 billion merger with AMR Corp.’s American Airlines.
The S&P 500 rose 0.1 percent to 1,521.95 at 2:59 p.m. in New York, after slumping as much as 0.4% earlier. The Dow Jones Industrial Average dropped 3.17 points, or less than 0.1%, to 13,979.74. Trading in S&P 500 companies was 14% above the 30-day average at this time of day.
“There is global economic weakness and we’re still constrained growth-wise,” Scott Armiger, a money manager at Christiana Trust in Greenville, Delaware, said in a telephone interview. His firm has $15 billion in client assets. “It’s an environment where it’s easier to buy growth than trying to grow organically.”
Data today showed the recession in the euro area deepened, with the worst performance in almost four years. In Japan, gross domestic product shrank an annualized 0.4%, amid falling exports and a business-investment slump.
U.S. jobless claims decreased by 27,000, the most in a month, to 341,000 in the week ended Feb. 9, Labor Department figures showed. The level of filings trailed any projection in a Bloomberg survey in which the median forecast was 360,000.
The S&P 500 has climbed 6.7% in 2013 as U.S. lawmakers reached a budget compromise. It has more than doubled since bottoming in March 2009 as the Federal Reserve conducted three rounds of bond buying to lower interest rates and boost economic growth. The gauge is about 3 percent below its record of 1,565.15 reached in October 2007.
Six out of the 10 industry groups advanced in the S&P 500 as energy companies gained the most, rising 0.7%. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, fell 2.1% to 12.71.