The Dow Jones Industrial Average and S&P 500 indexes advanced on Thursday after a round of positive corporate earnings announcements, but gains were curbed, and the Nasdaq lost ground on a drop in the healthcare sector.
DowDuPont rose 2.8 percent giving the largest individual gain to the S&P 500. It forecast third-quarter profit well above Wall Street’s expectations ahead of the combined company’s first earnings report next week.
Twitter rose 18.5 percent after the company said it could turn its first-ever profit in the fourth quarter, helped by cost cuts and new sources of revenue.
The healthcare sector, off 1.03 percent, held gains in check, led lower by a 16.4-percent decline in Celgene, the largest drag on the S&P 500 and the Nasdaq. The company reported lower-than-expected sales for its psoriasis drug Otezla and lowered its overall 2020 sales outlook.
Losses accelerated in the sector after the St. Louis Post-Dispatch reported, citing public records, that Amazon gained approval from a number of state pharmaceutical boards to become a wholesale distributor. Shares of the online retailer climbed about 6 percent following the closing bell after its quarterly results.
Trump’s search for a new Federal Reserve chair narrowed down to Fed Governor Jerome Powell and Stanford University economist John Taylor, according to a Politico report. A White House official told Reuters that no final decision had been made.
As third-quarter earnings season nears the half-way mark, 74 percent of companies have topped expectations, above the 72 percent beat rate for the past four quarters.
However, earnings growth for the quarter is currently 5.3 percent, well below the double-digit growth rates of the prior two quarters. With major U.S. indexes at record levels, earnings have been scrutinized to see if they warrant stretched valuations.
Also denting healthcare names was a fall of 4.8 percent in Bristol-Myers Squibb after its quarterly profit fell short of estimates due to higher costs and an inventory write-off. AbbVie fell 2.4 percent after reporting deaths in psoriasis studies.
Late in the session, shares of Aetna surged after Dow Jones reported CVS Health was in talks to buy the company. Aetna shares ended the day up 11.5 percent at $178.60
Approximately 7.04 billion shares changed hands on the major domestic equity exchanges, a number that was above the 5.97 billion share daily average over the past 20 sessions.