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US: Wall Street flat as banks, Amgen weigh; Adobe rallies

Saturday, March 18, 2017 - 06:10

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[NEW YORK] US stocks dipped on Friday as bank shares fell alongside Treasury yields while Adobe helped buoy the S&P tech sector and the Nasdaq Composite.

Amgen was the largest drag on both the S&P 500 and Nasdaq, down 6.4 per cent at US$168.61, after the extent of a cholesterol drug's benefits in a highly anticipated study disappointed investors, even if it cut the risk of heart attacks and strokes by over 20 per cent in patients with heart disease.

The S&P tech index was supported by Adobe's surge to a record high of US$130.30 after the Photoshop software maker reported strong earnings. The stock ended up 3.8 per cent at US$127.01.

Indexes were little changed for a second day even if the Nasdaq Composite touched a record intraday high. Analysts say investors are expecting a catalyst to thrust stocks higher after bets on President Trump's promises of tax cuts and a fiscal stimulus drove Wall Street to all-time highs on a weeks-long rally.

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"Investors are moving from sector to sector dependent on where the US dollar is, comments from the White House on the health care act, and earnings," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.

"The 10-year (benchmark US Treasury note yield) dipped below 2.5 per cent and financials pull back while utilities get bid. This churn is a way for the market to consolidate."

Analysts increasingly worry that the Trump administration is spending too much of its political capital in an effort to pass a Republican-proposed healthcare bill, which may leave it wanting for support when it tries to reform the tax code.

Bets on the passing of a tax reform are one of the pillars of the equities rally since the November presidential election.

"This is a market waiting for its next catalyst and I think it wants to hear it from the White House," Ms Krosby said.

"That's very important for a market that embraced the pro growth agenda of the Trump administration."

The Dow Jones Industrial Average fell 19.93 points, or 0.1 per cent, to end at 20,914.62, the S&P 500 lost 3.13 points, or 0.13 per cent, to 2,378.25 and the Nasdaq Composite added 0.24 point, or 0 per cent, to 5,901.00.

For the week the S&P rose 0.2 per cent, the Dow gained less than 0.1 per cent and the Nasdaq added 0.7 per cent.

The S&P 500's financial sector posted its first back-to-back weekly decline since September.

Tiffany touched a 19-month high of US$94 after higher-than-expected quarterly results. Shares of the high-end jeweller closed up 2.7 per cent at US$92.42.

About 9.68 billion shares changed hands in US exchanges, compared with the 7.1 billion daily average over the last 20 sessions.

Advancing issues outnumbered declining ones on the NYSE by a 1.51-to-1 ratio; on Nasdaq, a 1.43-to-1 ratio favoured advancers.

The S&P 500 posted 64 new 52-week highs and three new lows; the Nasdaq Composite recorded 175 new highs and 58 new lows.

REUTERS

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