US STOCKS-Amazon-Whole Foods deal roils Wall St; energy shares gain


Reuters

* Wal-Mart, Target, Walgreen, Costco, Kroger hit hard
    * Amazon gives biggest lift to S&P
    * S&P tech sector drops for second week
    * Dow up 0.11 pct, S&P up 0.03 pct, Nasdaq down 0.22 pct

 (Updates to close of U.S. markets)
    By Lewis KrauskopfNEW YORK, June 16 (Reuters) - Major U.S. stock indexes ended
little changed on Friday even as Amazon.com's$13.7 billion deal
to buy upscale grocer Whole Foods roiled the retail sector and
rocked shares of an array of companies including Wal-Mart and
Target.
    Energy sector shares helped buoy the S&P 500 and the Dow
industrials, while Apple dragged on the Nasdaq.
    The deal by Amazon, a proven retail disruptor, marked a
major step by the internet retailer into the brick-and-mortar
retail sector. [nL3N1JD3Z4]
    Wal-Mart <WMT.N> shares sank 4.7 percent, weighing the most
on the Dow. Shares of Target <TGT.N>, Walgreen Boots <WBA.O> and
Costco <COST.O> fell between 5 percent and 7 percent.
    "It's going to send a shock wave across the board, and this
represents the true utmost in market disruption," said Burns
McKinney, chief investment officer with the Dallas investment
team for Allianz Global Investors. "There's big winners and big
losers."
    Amazon shares gained 2.4 percent, making the stock the
biggest boost to the S&P 500. Whole Foods <WFM.O> shares surged
29.1 percent.
    The S&P consumer staples sector <.SPLRCS> fell 1 percent, by
far the worst performing major sector. The S&P 500 food and
staples retailing index <.SPLRCFD> dropped 4.2 percent.
    Grocery chain Kroger <KR.N> was the biggest loser on the S&P
500, falling 9.2 percent, while Supervalu <SVU.N> dropped 14.4
percent.
    "I would not like to be somebody playing in the grocery
space right now," said Jan Rogers Kniffen, chief executive of
retail consultancy firm J. Rogers Kniffen WWE in New York.
    The Dow Jones Industrial Average <.DJI> rose 24.38 points,
or 0.11 percent, to end at 21,384.28, the S&P 500 <.SPX> gained
0.69 point, or 0.03 percent, to 2,433.15 and the Nasdaq
Composite <.IXIC> dropped 13.74 points, or 0.22 percent, to
6,151.76.
    The technology sector <.SPLRCT> fell 0.2 percent, continuing
its recent slump. Apple <AAPL.O> shares closed down 1.4 percent.
    Tech has led the S&P 500's 8.7 percent rally this year, but
posted its second week of declines, prompting questions over
whether investors are moving money into other sectors.
[nL1N1JC0S8]
    "I think we need to see more of a pullback to say there is a
serious rotation going on as opposed to just some profits coming
off the top," said Chuck Carlson, chief executive officer at
Horizon Investment Services in Hammond, Indiana.
    Energy shares <.SPNY> rose 1.7 percent, propping up the S&P
500. Oil prices <CLc1> <LCOc1> bounced off the year's lows as
some producers reduced exports and U.S. rig additions slowed.
[nL3N1JD2UH]
    U.S. homebuilding fell for a third straight month in May to
the lowest in eight months as construction activity declined
broadly. [nL1N1JC1FK] Investors were continuing to digest the
Federal Reserve's interest rate hike on Wednesday, with some
concerned about the economy's ability to absorb higher rates.
    In other corporate news, Booz Allen Hamilton <BAH.N> shares
dropped 19 percent after news of a U.S. Department of Justice
investigation. [nL3N1JC5EC]
    Advancing issues outnumbered declining ones on the NYSE by a
1.36-to-1 ratio; on Nasdaq, a 1.22-to-1 ratio favored decliners.
    About 9.7 billion shares changed hands in U.S. exchanges,
well above the 6.8 billion daily average over the last 20
sessions.

 (Additional reporting by Caroline Valetkevitch in New York, and
Yashaswini Swamynathan, Natalie Grover and Sruthi Shankar in
Bengaluru; Editing by Anil D'Silva and James Dalgleish)
 ((lewis.krauskopf@thomsonreuters.com; 646-223-6082; Reuters
Messaging: lewis.krauskopf.thomsonreuters.com@reuters.net,
Twitter: @LKrauskopf))

Keywords: USA STOCKS/ (UPDATE 6)



This article appears in: World Markets , US Markets , Stocks
Referenced Symbols: AAPL , BAH , COST , KR , SVU


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