Wall Street edges back from its record heights

NEW YORK (AP) — U.S. stocks are pulling away from their record heights on Monday.

The S&P 500 slipped 0.3% in afternoon trading, though it remains within 0.6% of its all-time high set in October. The Dow Jones Industrial Average was down 229 points, or 0.5%, as of 1:09 p.m. Eastern time, and the Nasdaq composite was 0.1% lower.

Berkshire Hathaway was a heavy weight on the market and fell 1.8% after announcing a shake-up of some of its top leadership. Todd Combs, who had been CEO of the company's GEICO insurance business, is leaving for a job at JPMorgan Chase, while Chief Financial Officer Marc Hamburg will retire next year.

Netflix dropped 4.3% after Paramount announced a bid in hopes of trumping Netflix's deal to buy Warner Bros., which was announced last week.

Paramount said it’s offering $30 for each Warner Bros. Discovery share, as well as a quicker and easier way for investors to get their payout. Paramount is offering to buy all of Warner Bros. Discovery in cash, unlike Netflix’s offer of cash and stock for just Warner Bros. following its pending split with Discovery.

The board of directors for Warner Bros. Discovery had agreed to Netflix's offer last week, but it's already facing potential scrutiny from federal regulators because of worries about too much industry power sitting at one company. President Donald Trump said Sunday that a Netflix-Warner Bros. combination “could be a problem.”

Warner Bros. Discovery rose 3.7% following the hostile buyout bid, and Paramount Skydance’s stock climbed 9.1%.

Elsewhere on Wall Street, Confluent soared 29.4% after IBM said it would buy the company, which helps customers connect and process data. IBM said the $11 billion deal will help customers deploy artificial-intelligence tools better and faster, and its shares added 1%.

Carvana jumped 12.7% in its first trading after learning it will join the S&P 500 index on Dec. 22. Many professional investors directly mimic the index or at least measure their performance against it, which will push many to buy any stocks within it.

CRH, a provider of building materials, rose 5.9%, and Comfort Systems USA, a provider of mechanical and electrical contracting services, added 0.9% after likewise learning they’ll join the S&P 500 in a couple weeks.

They will replace LKQ, Solstice Advanced Materials and Mohawk Industries, which have all shrunk enough in size that they’ll drop down to the S&P SmallCap 600 index of smaller stocks.

CoreWeave sank 4.2% after the AI cloud company said it’s raising $2 billion in debt that it could repay in stock and cash.

Moves elsewhere on Wall Street were relatively modest. The U.S. stock market has become much more calm recently following weeks of sharp and scary swings.

The highlight of this week will come Wednesday, when the Federal Reserve will announce its latest move on interest rates.

Stocks have already run to the edge of their records on widespread expectations that the Fed will cut its main interest rate for the third time this year. Lower interest rates can give the economy and prices for investments a boost, though their downside is that they can worsen inflation.

The big question is what kind of hints the Fed will offer about where interest rates will go after that. Many on Wall Street are bracing for talk aimed at tamping down expectations for more cuts in 2026.

Inflation has stubbornly remained above the Fed’s 2% target, and Fed officials are notably split in their opinions about whether high inflation or the slowing job market is the bigger threat to the economy.

In the bond market, Treasury yields climbed. The yield on the 10-year Treasury rose to 4.18% from 4.14% late Friday.

In stock markets abroad, indexes slid 1.2% in Hong Kong but jumped 1.3% in South Korea for two of the world’s bigger gains.

AP Business Writers Matt Ott and Elaine Kurtenbach contributed.

Trader Edward Curran works on the floor of the New York Stock Exchange, Monday, Nov. 24, 2025. (AP Photo/Richard Drew)

A person walks in front of an electronic stock board showing Japan's Nikkei index at a securities firm Thursday, Dec. 4, 2025, in Tokyo. (AP Photo/Eugene Hoshiko)

Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI), top left, and the foreign exchange rate between U.S. dollar and South Korean won, top center, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Monday, Dec. 8, 2025. (AP Photo/Ahn Young-joon)

Currency traders work near a screen showing the Korea Composite Stock Price Index (KOSPI) and the foreign exchange rate between U.S. dollar and South Korean won, top right, at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Monday, Dec. 8, 2025. (AP Photo/Ahn Young-joon)

A currency trader watches monitors near a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Monday, Dec. 8, 2025. (AP Photo/Ahn Young-joon)

NEW YORK (AP) — Paramount on Monday launched a hostile takeover offer for Warner Bros. Discovery, initiating a potentially bruising battle with rival bidder Netflix to buy the company behind HBO, CNN and DC Studios, and the right to reshape much of the nation's entertainment landscape.

Emerging just days after top Warner managers agreed to Netflix's $72 billion purchase, Paramount's bid seeks to go over the heads of those leaders by appealing directly to Warner shareholders with more money — $74.4 billion — and a plan to buy all of Warner's business, including the cable business that Netflix does not want.

Paramount said its decision to go hostile came after it made several earlier bids that Warner management “never engaged meaningfully” with following the company's October announcement that it was open to selling itself.

In its appeal to shareholders, Paramount noted its offer also contains more cash than Netflix's bid — $18 billion more — and argued that it's more likely to pass antitrust scrutiny from the Trump administration.

Netflix on Monday said it had no comment about Paramount's challenge. But on Friday, Netflix downplayed concerns that regulators would oppose a combination of Netflix and Warner’s HBO Max streaming business.

The fight for Warner drew strong reaction in Washington, with politicians from both major parties picking sides and citing the likely impact on streaming prices, movie theater employment and the diversity of entertainment choices and political views.

Over the weekend, President Donald Trump weighed in, too, saying a Netflix-Warner combo “could be a problem” because of the size of the combined market share.

Paramount, run by David Ellison, whose family is closely allied with Trump, said it had submitted six proposals to Warner over a 12-week period before the latest offer.

“We believe our offer will create a stronger Hollywood. It is in the best interests of the creative community, consumers and the movie theater industry," Paramount Chairman and CEO David Ellison said in a statement. He added that his deal would lead to more competition in the industry, not less, and more movies in theaters.

Adding to the political intrigue in the dueling bids, a regulatory document released Monday stated that an investment firm run by Trump's son-in-law Jared Kushner would be investing in the Paramount deal, too.

On Friday, Netflix struck its deal to buy Warner Bros. Discovery, the Hollywood giant behind “Harry Potter” and HBO Max. The cash and stock proposal is valued at $27.75 per Warner share, giving it a total enterprise value of $82.7 billion, including debt.

The transaction is expected to close in the next 12 to 18 months, after Warner completes its previously announced separation of its cable operations. Not included in the deal are networks such as CNN and Discovery.

The federal government has authority to kill any big media deals if it has antitrust concerns. Trump has said he will be personally involved in the decision regarding Warner Bros.

Usha Haley, a Wichita State University professor who specializes in international business strategy, said Paramount’s ties to Trump are notable. Ellison is the son of longtime Trump supporter Larry Ellison, the world’s second-richest person.

“He said he’s going to be involved in the decision. We should take him at face value,” Haley said of Trump. “For him, it’s just greater control over the media."

The bid for Warner Bros. comes on the heels of Paramount's October purchase of the news and commentary website The Free Press. Paramount then installed the site's founder, Bari Weiss, as the editor-in-chief of CBS News, saying it believes the country longs for news that is balanced and fact-based.

It was a bold step for the television network of Walter Cronkite, Dan Rather and “60 Minutes,” long viewed by many conservatives as the personification of a liberal media establishment. The network placed someone in a leadership role who has a reputation for resisting orthodoxy and fighting “woke” culture.

Paramount's tender offer is set to expire on Jan. 8 unless it's extended.

Shares of Warner Bros. jumped nearly 4%, and Netflix was down 4% Monday in early afternoon trading. Paramount was up 9%.

Associated Press writers Matt Sedensky, David Bauder and Charles Sheehan in New York contributed to this report.

The Warner Bros. water tower is seen at Warner Bros. Studios in Burbank, Calif., Friday, Dec. 5, 2025. (AP Photo/Jae C. Hong)

The Warner Bros. water tower is seen at Warner Bros. Studios in Burbank, Calif., Friday, Dec. 5, 2025. (AP Photo/Jae C. Hong)