All three major US stock indexes were up in late-morning trading Friday, as Wall Street processed the latest batch of inflation data.
The personal consumption expenditures price index rose by 0.3% in September, as expected in a survey conducted by Bloomberg, lifting the year-over-year rate to 2.8% from 2.7%. The core PCE, which excludes volatile food and energy prices and is the Federal Reserve's preferred inflation gauge, rose by 0.2%, as expected, slowing the year-over-year rate to 2.8% from 2.9% in August.
In company news, Netflix (NFLX) and Warner Bros. Discovery (WBD) said Friday that Netflix will acquire Warner Bros., including its TV studios, HBO Max and HBO, in an $82.7 billion cash-and-stock deal. Under the terms of the deal, Warner Bros. Discovery shareholders will receive $23.25 in cash and $4.50 in Netflix stock for each WBD share outstanding at the closing of the transaction, which is expected to occur in 12 to 18 months. The White House is viewing the acquisition with "heavy skepticism," CNBC reported Friday, citing an unnamed senior administration official. Separately, Paramount Skydance (PSKY) had offered to acquire Warner Bros. for $30 per share, CNBC reported Friday, citing sources with knowledge of the matter. Netflix shares were down 2.5% around midday, while Warner Bros. shares were up 3.7%, and Paramount shares were down 6.4%.
Southwest Airlines (LUV) said Friday in a regulatory filing it now expects 2025 earnings before interest and taxes, excluding special items, of about $500 million, down from previous guidance of $600 million to $800 million. The airline cited the government shutdown and higher fuel prices as the drivers of the revision. Southwest shares were up 5.3%.
SoftBank is in talks to buy private-equity firm DigitalBridge Group (DBRG), Bloomberg reported Friday, citing people with knowledge of the matter. DigitalBridge shares were up 32%.
Hewlett Packard Enterprises (HPE) reported fiscal Q4 adjusted earnings late Thursday of $0.62 per diluted share, up from $0.58 a year earlier and above the FactSet consensus analyst estimate of $0.58. Fiscal Q4 revenue was $9.68 billion, up from $8.46 billion a year ago but below the FactSet consensus of $9.90 billion. For fiscal Q1, the company said it expects adjusted EPS of $0.57 to $0.61 and revenue of $9 billion to $9.40 billion. Analysts expect $0.53 and $9.87 billion, respectively. For full-year fiscal 2026, the company said it expects adjusted EPS of $2.25 to $2.45. Analysts expect $2.36. Hewlett Packard shares were up 0.1%.
Price: 100.28, Change: -2.94, Percent Change: -2.85
