SAN FRANCISCO (Reuters) - An overhauled telecommunications sector featuring most of the so-called FANG stocks could debut as Wall Street’s hottest bet when it kicks off in September, boosted by a rising wave of media and television acquisitions.
Long viewed as stodgy stocks for dividend-oriented investors, the telecom services sector .SPLRCL will be renamed communications services and supercharged with the addition of Facebook (FB.O), Netflix (NFLX.O) and Google-owner Alphabet (GOOGL.O) - three of the four FANGs, along with Amazon - as well as other companies that have driven the stock market to record highs in recent years.
The changes are part of the largest-ever shakeup of the stock market’s broad business categories.
In total, 14 S&P 500 companies, including Netflix, will shift from the consumer discretionary sector into communications, joining AT&T, Verizon Communications (VZ.N) and CenturyLink (CTL.N) in the biggest shakeup of the Global Industry Classification Standard, or GICS, since it was created in 1999. Five S&P 500 companies will switch from technology to communications.
The new sector will also include Walt Disney (DIS.N), Comcast (CMCSA.O) and other entertainment and media companies scrambling to consolidate and fend off competition from newcomers Netflix and Alphabet, which produce content and sell it directly to consumers.
The floodgates for such deals were sprung open this month by a legal ruling giving AT&T (T.N) the go-ahead to buy Time Warner for $85 billion.
“Among all of the sector groups, this is going to be the most dynamic,” predicted Jack Ablin, chief investment officer at Cresset Wealth Advisors in Chicago. “You will
