US President-elect Donald Trump gives a press conference January 11, 2017 in New York. (DON EMMERT/AFP/Getty Images)
U.S. stocks slipped to session lows, before recovering ground, on Wednesday as drug stocks took a beating after Donald Trump’s comments on drug pricing in his first formal news conference after his election victory.
The President-elect lashed out at pharmaceutical companies, saying they were “getting away with murder” by charging high drug prices.
Drug pricing has become a lightning rod for criticism with several drugmakers coming under federal investigation for price gouging.
The S&P 500 healthcare index, which reversed course following Mr. Trump’s comments, was down about 1 per cent and on track for its worst day since Nov. 22.
The Nasdaq biotechnology index lost 2.4 per cent. Both indexes are on track to snap a six-day winning streak.
“We expect the U.S. biotech and pharmaceutical sector to be very volatile in the coming days and any mergers and acquisition will not be that easy,” said Naeem Aslam, chief market analyst at ThinkMarkets UK.
The top five losers on the S&P 500 were healthcare-related stocks, led by Pfizer. Amgen weighed the most on the Nasdaq, while J&J was the biggest drag on the Dow.
“In times like this the expectation is for an erratic, choppy environment, however we have not got anything earth shattering,” said Andre Bakhos, managing director at Janlyn Capital in Bernardsville, NJ.
The Dow Jones Industrial Average was up 55.17 points, or 0.28 percent, at 19,910.7, the S&P 500 was up 0.91 points, or 0.04 per cent, at 2,269.81 and the Nasdaq Composite was down 3.68 points, or 0.07 per cent, at 5,548.14.
Five of the 11 major S&P sectors were lower.
Energy stocks rose tracking a more-than-2-per-cent gain in oil prices. That helped limit losses.
Merck’s near 3-per-cent rise and Goldman Sachs’s near 1-per-cent increase helped keep the Dow afloat.
Lockheed Martin dropped about 1 per cent after Mr. Trump said the F-35 fighter jet project “is way behind schedule and billions over budget.”
Canada’s main stock index erased slight gains during Mr. Trump’s speech.
The Toronto Stock Exchange’s S&P/TSX composite index was up 13.49 points, or 0.09 per cent, to 15,439.77 at 12:19 p.m.
The index’s health care group was down 2.2 per cent.
Department store operator Hudson’s Bay Co fell 6.9 per cent to $9.46, extending a sharp fall to a record low in the prior session as its poor holiday season sales and lower outlook led several banks to slash price targets on the stock.
Oil increased after a government report showed U.S. refiners processed a record amount of crude last week.
Refineries nationwide used 17.1 million barrels a day of crude last week, according to the Energy Information Administration, the most in weekly data going back to 1989. Refineries operated at the highest utilization rate since September before they perform planned seasonal maintenance. Oil stockpiles rose 4.1 million barrels, more than the 1.5 million barrel increase forecast by analysts surveyed by Bloomberg.
“Refineries are cranking out production to build fuel stockpiles before they go into maintenance,” said Craig Bethune, a fund manager at Manulife Asset Management Ltd. in Toronto who focuses on energy and natural resources investments. “Seasonally, it’s not that unusual to see big inventory builds.”
West Texas Intermediate crude for February delivery rose $1.15 a barrel on the New York Mercantile Exchange. Brent for March settlement rose $1.31 to $54.95 a barrel on the London-based ICE Futures Europe exchange.
Mexico’s peso weakened to a historic low of 22 per dollar on Wednesday, shortly after Mr. Trump began his news conference.
The peso was the worst-performing major currency last year, weakening 20 per cent against the dollar as Trump closed in on the U.S. presidency.
The currency pared losses slightly after passing the psychological 22 peso barrier to trade at 21.90 per dollar, dipping 0.45 per cent.
The peso’s depreciation has sped up in the first few days of 2017. Trump told major automakers last week to expect high taxes on vehicles made in Mexico that are sold in the United States as he attempts to bring back manufacturing jobs.
This article was sourced from http://newsa4.com