Walt Disney (DIS) stock is testing a buy point Monday amid a Fox-fueled rally.
X The boost follows a late-Friday report from the Wall Street Journal that Disney and 21st Century Fox (FOXA) were back at the table to discuss the possible acquisition of some of Fox's assets, namely its movie and TV studio, and certain international and cable properties.
Shares of Disney jumped as high as 7% on the stock market today to 112.67, clearing a 110.93 buy point from a double-bottom base that has lows in July and September. The stock was up 5.3% to 110.80 in afternoon action, just below that entry.
NBCUniversal parent Comcast (CMCSA) made a definitive jump above its longer-term 200-day line; Journal sources say the conglomerate is also in active talks with Fox. Fox, Disney and Comcast all own 30% of streaming network Hulu.
Verizon Communications (VZ) also has been bandied about as a potential wooer of Fox assets.
IBD'S TAKE: In the right conditions, the W-shaped double-bottom base in a bull market can translate to solid gains. Learn more about that particular base pattern here.
Fox shares are up 3.9%.
The media rally is extending to peer entertainment stocks, with Viacom (VIAB) up 3.6%, continuing its ascent above the 50-day moving average.
Some analysts expressed skepticism last month about reports of such a Disney-Fox union. Cowen's Doug Creutz said he "can't believe this is serious," and that a deal "makes zero sense."
But others see the benefit of bringing "Planet of the Apes," "Alien" and other Fox franchises and content into the Disney fold, particularly as Disney builds out its own stand-alone streaming platform to rival Netflix (NFLX).
Netflix shares fell 1% intraday, having breached support at their 50-day and 190.05 buy point last Wednesday.
Verizon rose 1.7% to 52.13. Verizon cleared a 51.28 buy point intraday after surging 9% last week.