Stock Indexes Mixed In Late Trade After Trump Announces Drug Price Plans

Stock indexes were mixed Friday afternoon but they bounced from afternoon lows as President Trump unveiled a plan to cut drug costs.


The Nasdaq composite was down 0.2% while the S&P 500 was up a fraction and the Dow Jones industrial average gained 0.2%. Small caps were flat also. But the Dow transports surged 1%, apparently getting some help from a drop in oil prices.

Volume was tracking lower compared with the same time Thursday. Advancers had a small advantage over decliners on the Nasdaq and NYSE. (For updates on this story and other market coverage, visit Stock Market Today.)

President Trump announced a program aimed at lowering drug prices, including measures to increase competition.

Drug distributor stocks fell as Trump unveiled details, but soon rallied back. McKesson (MCK) erased a 1% loss and was up 1.6% in afternoon trading. AmerisourceBergen (ABC) and Cardinal Health (CAH) erased losses of 1% to 2% and were up roughly 1%. Those stocks have been lagging for months, however.

The market saw no real threat to the pharmaceutical industry, as the sector led the market. SPDR S&P Pharmaceutical (XPH) and iShares Nasdaq Biotech (IBB) were about 2.5%. IBD’s ethical drugs industry group was third best on the day, up 1.2%. The generic drugs group climbed 1% and biotechs rose 0.9%.

The technology sector saw some big moves after earnings reports.

Nvidia (NVDA) gave back a minor piece of its rally over the previous several days, and it held above the 239.35 buy point of a double bottom base. The chip company beat sales and profit views thanks partly to demand for chips used in the mining of cryptocurrencies.

Dropbox (DBX) shares were down 1.7% in a volatile session. The company reported adjusted first-quarter profit and revenue that beat expectations in its first post-IPO earnings report. The file-sharing and storage company went public at 21 a share on March 23 and has been one of the most heavily traded new issues. Daily volume averaged more than 5 million from Wednesday through today’s trading.

On the IBD 50, TAL Education (TAL) tried to break out past the 41.85 buy point of a base-on-base pattern. But the sputtering action shouldn’t be much of surprise because the base is quite late stage. TAL, a Chinese tutoring and education services provider, has made an amazing run from its breakout in November 2015. It has formed and cleared at least five bases since then, and further gains would be harder to produce.

Diamondback Energy (FANG) is rapidly giving back territory. It is now nearly 5% below the 130.80 buy point of a cup with handle breakout earlier this week. On Friday, Diamondback fell below the 50-day moving average. If shares cannot rebound around that level, the breakout would be further compromised.


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Originally posted 2019-09-19 23:14:21.


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