Gains for drugmakers help US stocks reach new records
AP Markets Writer
NEW YORK – U.S. stocks finished slightly higher Thursday, led by technology companies and drugmakers. After a big move the day before, that was enough to take stocks back to record highs.
After a slow start, stocks gradually moved upward in afternoon trading as companies in technology, basic materials, real estate and finance contributed modest gains. Drugmaker AbbVie jumped after it reached a deal with a competitor that would delay competition for its anti-inflammatory treatment Humira, the biggest-selling drug in the world. Industrial firms took small losses as big names like Boeing and General Electric declined.
September is historically the weakest month of the year for stocks, but the Standard & Poor’s 500 has risen 1.6 percent this month. The third quarter ends Friday, and the index has climbed 12 percent this year. That has some investors wondering if other markets are poised to do better than U.S. stocks in the months to come.
“The U.S. economic cycle is so much further along than the Europe economic cycle,” said Sameer Samana, global quantitative strategist for the Wells Fargo Investment Institute. He added that European stocks haven’t done as well as U.S. stocks in 2017, and with the European Central Bank getting ready to start raising interest rates, banks in Europe should start making more money.
But Samana thinks stocks that are linked to U.S. economic growth, like banks and industrial and consumer-focused companies, should continue to do well. Those stocks mostly climbed on Thursday.
The Standard & Poor’s 500 index rose 3.02 points, or 0.1 percent, to a record high of 2,510.06. The Dow Jones industrial average gained 40.49 points, or 0.2 percent, to 22,381.20. The Nasdaq composite inched up 0.19 points to 6,453.45. The Russell 2000 index of smaller-company stocks continued to set new highs as it advanced 3.97 points, or 0.3 percent, to 1,488.79.
Drugmaker AbbVie climbed after it resolved a patent dispute over Amgen’s version of AbbVie’s drug Humira, which is the source of most of its revenue. Amgen agreed not to begin selling its version of the anti-inflammatory medicine in Europe until October 2018, and the U.S. version won’t go on the market until Jan. 31, 2023.
The settlement would mean billions of dollars in additional sales for AbbVie, which reported $16 billion in Humira sales in 2016. Its stock gained $4.21, or 5 percent, to $88.96 and Amgen rose 58 cents to $185.46.
Abbott Laboratories jumped after the Food and Drug Administration approved its FreeStyle Libre Flash glucose monitoring system for adults with Type 1 diabetes. The product uses a sensor inserted below the skin to measure blood glucose. Analysts say Abbott could have a competitive edge because the FDA did not advise patients to take samples of their blood to confirm the system’s readings.
Abbott rose $1.9, or 2.9 percent, to $53.64. DexCom, which gets all its revenue from selling its own blood glucose monitoring system, plunged $22.03, or 32.7 percent, to $45.44 in heavy trading.
Spice maker McCormick raised its profit and revenue estimates after it beat expectations in the fiscal third quarter. Its stock gained $5.20, or 5.4 percent, to $101.65.
Streaming video device maker Roku surged in its first day of trading. Its initial public offering priced at $14 a share and it jumped $9.50, or 67.9 percent, to finish at $23.50. the company makes boxes and sticks that let users watch Netflix, Hulu and other streaming networks on their TVs. Roku was an early entrant in that industry, but now faces competition from companies like Amazon, Apple, and Google’s parent company Alphabet.
Roku raised $219 million from the offering and the IPO valued the company at $1.3 billion.
Drugstore chain Rite Aid dropped after its quarterly revenue fell short of Wall Street’s forecasts. The stock lost 25 cents, or 11 percent, to $2.03. Earlier this month the company agreed to sell almost half of its stores to rival Walgreens for $4.38 billion, but the slimmed-down deal was smaller than investors had hoped.
Benchmark U.S. crude gave up an early gain and fell 58 cents, or 1.1 percent, to $51.56 a barrel in New York. Brent crude, the standard for international oil prices, fell 49 cents to $57.41 per barrel in London.
Wholesale gasoline lost 2 cents to $1.63 a gallon. Heating oil fell 1 cent to $1.83 a gallon. Natural gas slid 4 cents to $3.02 per 1,000 cubic feet.
Bond prices rebounded from an early slump. The yield on the 10-year Treasury note remained at 2.31 percent.
Gold inched up 90 cents to $1,288.70 an ounce. Silver added 2 cents to $16.85 an ounce. Copper rose 5 cents to $2.98 a pound.
The dollar dipped to 112.39 yen from 112.75 yen. The euro rose to $1.1791 from $1.1756.
The German DAX gained 0.4 percent and the CAC 40 in France rose 0.2 percent. In Britain the FTSE 100 added 0.1 percent. Japan’s Nikkei index rose 0.5 percent and in South Korea the Kospi made a tiny gain. Hong Kong’s Hang Seng index slipped 0.8 percent.