U. S. stocks rose Thursday as gains for technology companies and banks helped the market recover some of its losses from earlier in the week. However drugmakers and distributors tumbled.
U. S. stocks rose Thursday as gains for technology companies and banks helped the market recover some of its losses from earlier in the week. However drugmakers and distributors tumbled.
The European Central Bank said Thursday that it would begin gradually reducing the bond purchases it has been making to strengthen the regional economy. Investors were glad the bank didin’t decide to be more aggressive. Starting in January the bank plans to cut the size of its purchases in half, to 30 billion euros a month. The euro weakened and European stock indexes jumped.
The Standard & Poor’s 500 index rose 3.25 points, or 0.1%, to 2,560.40. The Dow Jones industrial average gained 71.40 points, or 0.3%, to 23,400.86. The Nasdaq composite lost 7.12 points, or 0.1%, to 6,556.77. The Russell 2000 index of smaller-company stocks added 3.98 points, or 0.3%, to 1,497.46.
France’s CAC-40 jumped 1.5% and the DAX in Germany gained 1.4%. Britain’s FTSE 100 added 0.5%.
The euro fell to $1.1657 from $1.1807 as investors think interest rates in Europe will stay lower for longer than they had expected. The weaker euro helped shares of companies that export goods from Europe.
Bond prices edged lower. The yield on the 10-year Treasury note rose to 2.46% from 2.44% as yields and interest rates remained at seven-month highs. Higher rates mean banks can make larger profits from mortgages and other lending. SunTrust Banks rose 83 cents, or 1.4%, to $60.61 and American Express jumped $2.16, or 2.3%, to $95.69.
Drugmaker Celgene plunged after it reduced its forecasts for this year, partly because it expects weaker sales of its new psoriasis treatment Otezla. Celgene also said it won’t meet its longer-term goals: it cut its profit and sales projections for 2020 in anticipation of weaker sales of new products and medications to treat cancer and inflammation.
Celgene stock lost $19.57, or 16.4%, to $99.99. Bristol-Myers Squibb lost $3.05, or 4.8%, to $60.95 after it reduced its annual forecast. Other drugmakers including Amgen and Gilead Sciences also stumbled.
Materials companies climbed after a round of strong company results. Chemicals maker Dow DuPont jumped $1.96, or 2.8%, to $73.05 and industrial and medical gas company Air Products and Chemicals gained $6.80, or 4.4%, to $161.39.
Drugstores, prescription drug distributors and pharmacy benefits managers sank after the St. Louis Post-Dispatch reported that Amazon has received wholesale pharmacy licenses in at least 12 states, the latest suggestion that the company intends to enter that market. Investors in those companies fear Amazon will slash prices and hurt their revenue.
Walgreens fell $2.25, or 3.2%, to $67.11. McKesson, which rose as much as 7.4% in early trading after its quarterly report, wound up with a loss of $7.84, or 5.2%, to $143.54. Pharmacy benefits management company Express Scripts shed $2.23, or 3.6%, to $58.93.
Amazon reported its third-quarter results after the close of trading. Its stock rose 8% after Amazon reported net income of $256 million, or 52 cents per share, for the three months ending Sept. 30. That easily beat the 2 cents per share analysts had expected, according to FactSet.
CVS Health tumbled $2.22, or 2.9%, to $74.31. Minutes before the close of trading, the Wall Street Journal reported that the drugstore-pharmacy benefits company is in talks to buy health insurer Aetna. Aetna stock jumped $18.48, or 11.5%, to $178.60.
Benchmark U. S. crude added 46 cents to $52.64 a barrel in New York. Brent crude, used to price international oils, rose 86 cents, or 1.5%, to $59.30 a barrel in London.
Wholesale gasoline rose 2 cents to $1.75 a gallon. Heating oil picked up 2 cents to $1.84 a gallon. Natural gas fell 3 cents to $2.89 per 1,000 cubic feet.
Gold gave up $9.40 to $1,269.60 an ounce. Silver fell 11 cents to $16.81 an ounce. Copper lost 1 cent to $3.18 a pound.
Japan’s benchmark Nikkei 225 index edged 0.2% higher while South Korea’s Kospi dipped 0.5%. The Hang Seng in Hong Kong slipped 0.4%.
The dollar rose to 114 yen from 113.72 yen.
UPDATES:
2:30 p.m.: This article was updated after the close of markets.
This article was originally published at 7:50 a.m.
