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Stock Market News: Barrick Looks Golden; Viacom, CBS Approach Merger

Dan Caplinger, The Motley Fool

The stock market opened down on Monday, reacting negatively to growing worries on the geopolitical front. Not only have trade negotiations between the U.S. and China failed to bear fruit, but the rising tension related to protests in Hong Kong adds yet another element to the delicate relationship between the two global powers. As of 10 a.m. EDT, the Dow Jones Industrial Average (DJINDICES: ^DJI) was down 208 points to 26,081. The S&P 500 (SNPINDEX: ^GSPC) lost 23 points to 2,895, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) gave up 66 points to 7,894.

Earnings season is starting to wind down, but there are still a few companies left to report, and Barrick Gold (NYSE: GOLD) made waves with its latest financial results. Meanwhile, CBS (NYSE: CBS) and Viacom (NASDAQ: VIA) (NASDAQ: VIAB) have been working through merger negotiations for a while, and many now believe that they're very close to hammering out a definitive deal for the two media giants to combine.

Barrick shines

Shares of Barrick Gold picked up 3% after the gold mining giant reported upbeat second-quarter results. Investors were pleased to see Barrick say that it expects full-year gold production to come in at the top end of its previous guidance range, while costs are coming in toward the low end.

Two miners with headlamps inside a mine, with others surrounding.

At first glance, Barrick's fundamental performance might have seemed a bit lackluster, with production of 1.353 million ounces of gold actually coming in a bit less than the Canadian company managed to bring in three months ago. Yet adjusted earnings and free cash flow improved from year-ago levels, and Barrick is optimistic that key assets like its Loulo-Gounkoto mine in Mali and its Veladero mine in Argentina will continue to perform well.

The new Nevada Gold Mines joint venture with Newmont Goldcorp will play an important role in both companies' future. The deal, which closed July 1, stands to create cost-saving synergies and have a positive impact on overall production almost immediately.

As gold prices have soared lately, investors have taken a new look at top gold mining stocks. As a leader in the industry, Barrick will get a lot of attention from gold investors for the rest of 2019 and beyond.

Is the CBS-Viacom merger finally happening?

CBS and Viacom saw significant activity Monday morning in stock trading, with CBS inching higher as Viacom's shares fell about 3%. For quite a while now, there's been speculation that the two media giants would merge, and negotiations have apparently reached the point at which investors expect a deal imminently.

It's easy to understand why the two companies are interested in each other. As competition has gotten fiercer in the media industry, consolidation has become more common, and both of the companies are controlled by a holding company owned by the family of billionaire Sumner Redstone.

Yet this isn't the first time CBS and Viacom have tried to combine. Past attempts have failed largely because of personality conflicts between the Redstone family and other executives involved with the two companies. Moreover, it's been hard to agree on a price.

This time, however, the two companies seem to be close to agreement on a price that would give CBS a slight premium to Viacom. That's likely why Viacom shares are down, but in the long run, the combination should be beneficial to both companies.

Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool is short shares of CBS. The Motley Fool has a disclosure policy.

This article was originally published on Fool.com