Health Stocks Fall as Trump Slams Industry -- WSJ
January 12 2017 - 3:03AM
Dow Jones News
By Akane Otani and Riva Gold
Major U.S. stock indexes shook off a slide in health-care shares
and closed higher Wednesday.
In a choppy session, stocks rose heading into President-elect
Donald Trump's first news conference since the election, then
dipped into negative territory during the event before recovering
in the afternoon.
The Dow Jones Industrial Average swung 140 points between its
intraday high and low, and closed up 98.75 points, or 0.5%, at
19954.28.
The S&P 500 climbed 6.42 points, or 0.3%, to 2275.32, and
the Nasdaq Composite rose 11.83 points, or 0.2%, to 5563.65, a
fresh high.
The slump in health-care shares came after Mr. Trump said the
drug industry was "getting away with murder" and called for "new
bidding procedures." Health-care stocks were among the worst
performers in 2016 amid scrutiny over drug pricing.
The Nasdaq Biotechnology Index fell 3% Wednesday in its biggest
one-day drop since Oct. 11, and the S&P 500 health-care sector
lost 1%, its worst day since Nov. 22.
Shares of Endo International fell $1.30, or 8.5%, to $14.01 and
Perrigo fell 5.77, or 6.9%, to 77.88.
Gains in energy shares helped offset some of the declines as oil
prices jumped. U.S. crude for February delivery rose 2.8% to $52.25
a barrel in its best day since Dec. 1. The S&P 500's energy
sector climbed 1.2%.
Kate Warne, a principal and investment strategist at Edward
Jones, said she had hoped Mr. Trump's press conference would allow
her to glean more details on his potential policy agenda,
especially relating to fiscal stimulus and tax cuts. The conference
left her with more questions than answers, she said.
While U.S. stocks still seem poised for further gains in 2017 as
corporate earnings resume growth and the economy strengthens, Ms.
Warne said swings in individual stocks and sectors could become
more common.
"I think it's reasonable to be concerned that stocks have moved
ahead of the policy changes people are hoping for," Ms. Warne
said.
Stocks have rallied to records several times since November as
investors betting on business-friendly policies under Mr. Trump
boosted shares of banks and industrial companies, while largely
selling government bonds and driving up the dollar.
On Wednesday, the WSJ Dollar Index, which gauges the U.S.
currency against 16 others, fell 0.3%. Government bonds climbed,
with the 10-year U.S. Treasury yield falling to 2.368%, from 2.379%
on Tuesday. Yields fall as bond prices rise.
Gold, a haven, settled up 1% at $1,195.60 an ounce -- its
highest close since Nov. 22.
Elsewhere in stock markets, the Stoxx Europe 600 rose 0.2%.
London's FTSE 100 added 0.2% to close at its 10th straight record,
as a weakening currency supported the export-heavy index. Japan's
Nikkei Stock Average inched up 0.3%. Hong Kong's Hang Seng added
0.8% in its fifth consecutive day of gains.
Write to Akane Otani at akane.otani@wsj.com and Riva Gold at
riva.gold@wsj.com
(END) Dow Jones Newswires
January 12, 2017 02:48 ET (07:48 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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