By Yashaswini Swamynathan
U.S. stocks came off session lows on Tuesday as gains in consumer staples stocks countered the decline in banks and healthcare companies.Biotechnology and pharmaceutical stocks came under pressure after President-elect Donald Trump told the Washington Post that he would target drug companies over pricing and that he was ready to unveil a plan to replace Obamacare.The S&P 500 healthcare sector fell 0.85 percent, with Pfizer and Celgene weighing the most. The Nasdaq biotech index slipped nearly 2 percent. Investors maybe concerned that Trump is "going after the Affordable Care Act and is burning a little political capital that might otherwise have been used for business friendly matters," said Art Hogan, chief market strategist of Wunderlich Equity Capital Markets in New York. The dollar index fell by 0.7 percent to a near six-week low of 100.29 after Trump told the Wall Street Journal that the strength of the currency was hurting competitiveness of U.S. companies.
However, a 1.3 percent rise in consumer staples offset some of the losses. Wal-Mart rose 3.1 percent and gave the biggest boost to the S&P and the Dow after the retailer said it would create 10,000 jobs in the United States this year.U.S. stocks and the dollar have surged since Trump's election on bets that he would usher in an era of economic growth through fiscal stimulus. However, the rally has hit a speed bump as investors are increasingly nervous about what Trump's policies could mean to world trade.At 11:00 a.m. ET the Dow Jones industrial average was down 16.31 points, or 0.08 percent, at 19,869.42, the S&P 500 was down 3.19 points, or 0.14 percent, at 2,271.45 and the Nasdaq Composite was down 20.64 points, or 0.37 percent, at 5,553.48.
Financials, which have benefited the most in the post-election rally, were off 1.45 percent - the biggest losers among the 11 major S&P 500 sector indexes."The group's up 17 percent since the election, and they've all had at least one thing against them in the reports so far. So it's not surprising to see some profit-taking," Hogan said.
British Prime Minister Theresa May said the country would leave the European Union's single market upon its exit from the group, but that a final Brexit deal would be put to parliamentary vote.Advancing issues outnumbered decliners on the NYSE by 1,454 to 1,404. On the Nasdaq, 1,833 issues fell and 893 advanced.The S&P 500 index showed six new 52-week highs and one new low, while the Nasdaq recorded 40 new highs and 11 new lows. (Reporting by Yashaswini Swamynathan in Bengaluru; Editing by Anil D'Silva)
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Updated Date: Jan 17, 2017 23:15:05 IST