Wall Street Flat; Telecom Sector Tumbles

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The markets were little changed Thursday as traders mulled a slew of corporate headlines and a batch of strong economic data. However, the telecom sector fell sharply.

Today's Markets

As of 3:15 p.m. ET, the Dow Jones Industrial Average fell 2.4 points, or 0.02%, to 13981, the S&P 500 rose 1.7 points, or 0.11%, to 1522 and the Nasdaq Composite gained 2.7 points, or 0.09% to 3199.

Several big telecom names were under heavy pressure throughout the trading day. Chief among them was CenturyLink (NYSE:CTL), which plunged 20% after surprising Wall Street by cutting its dividend and hiking its share buyback. Windstream (NYSE:WIN) and Frontier Communications (NYSE:FTR) fell sharply as well. Verizon (NYSE:VZ) and AT&T (NYSE:T), both higher-profile companies in the space, fell by a slimmer margin.

Looking at the Dow, Cisco (NASDAQ:CSCO) posted the worst performance, sinking more than 2% despite posting better-than-expected quarterly earnings.

News Deluge

There were no lack of headlines Thursday in what had previously been a fairly quiet week for Wall Street.

The pace of mergers and acquisitions has heated up substantially recently, with numerous big deals being announced in recent weeks. Ahead of the opening bell, H.J. Heinz (NYSE:HNZ) said it will be acquired by Berkshire Hathaway and 3G Capital for $72.50 a share -- a 20% premium to the food company's closing price on Wednesday. The deal, valued at $28 billion, is the biggest ever in the food industry, according to the two companies.

U.S. Airways (NYSE:LCC) and bankrupt American Airlines parent AMR also took the wraps off a tie-up that will create the world's biggest airline, valued at $11 billion.

Meanwhile, on the earnings front, Cisco (NASDAQ:CSCO) unveiled quarterly results that topped expectations on the top and bottom lines.

There was also a better-than-expected report on the labor market. The Labor Department said new claims for U.S. unemployment benefits fell to 341,000 last week from an upwardly revised 368,000 the week prior. Claims were expected to fall to 360,000 from an initially reported 366,000.

Oil futures drifted higher. The benchmark contract traded in New York rose 30 cents, or 0.31%, to $97.31 a barrel. Wholesale New York Harbor gasoline soared 2.7% to $3.117 a gallon. In metals, gold fell $9.60, or 0.58%, to $1,636 a troy ounce.

Foreign Markets

The Euro Stoxx 50 fell 0.81% to 2635, the English FTSE 100 dipped 0.5% to 6327 and the German DAX slumped 1.1% to 7631.

In Asia, the Japanese Nikkei 225 gained 0.5% to 11307 and the Chinese Hang Seng climbed 0.85% to 23413.