Thursday 22nd October 2015 |
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Wall Street fluctuated as biotech stocks declined amid accusations of fraud at Valeant Pharmaceuticals, while the latest US earnings offered disappointments such as Yahoo and Chipotle Mexican Grill and stellar surprises such as General Motors.
In New York trading at about 1.37pm, the Dow Jones industrial average inched 0.05 percent higher. The Standard & Poor’s 500 Index fell 0.4 percent, while the Nasdaq Composite Index slid 0.7 percent.
In the Dow, gains in shares of United Technologies and those of Travelers, last up 3.1 percent and 2 percent respectively, outweighed slides in shares of UnitedHealth and those of Pfizer, last down 3.8 percent and 2.6 percent respectively.
Shares of Yahoo dropped, last 4.6 percent lower, after the company reported earnings that fell short of the mark and underpinned concern about its outlook.
Shares of Valeant plunged nearly 40 percent amid accusations of fraud. Trading in the stock was briefly halted, as the company issued a statement responding to claims by Citron Research.
Citron Research said in a report on Wednesday that Valeant is using a specialty pharmacy called Philidor RX Services to store inventory and record those transactions as sales, according to Bloomberg.
“Is this Enron part Deux?” according to the Citron Research report. “These similarities are too close to ignore.”
Valeant refuted the “erroneous report”.
In health care news, shares of Aetna and Humana as well as those of Anthem and Cigna slid after Democratic presidential candidate Hillary Clinton warned she had "serious concerns" about the companies’ proposed mergers.
There were solid earnings too. Shares of General Motors jumped 6 percent after the car maker posted a record quarterly profit.
“These results reflect our work to capitalise on our strengths in the US and China, while taking decisive, proactive steps to mitigate challenges elsewhere," GM CEO Mary Barra said in a statement. “GM is a vastly different company today than just five years ago. We’re building a strong foundation, driving earnings growth in our core business and executing a plan to lead the future of personal mobility, all with the aim of creating shareholder value for years to come.”
Shares of Boeing added 1.8 percent after the plane maker upgraded its full-year earnings outlook.
“Earnings reports have been more good than bad so far, but the real meat of earnings will be in the next two weeks,” Michael James, managing director of equity trading at Wedbush Securities in Los Angeles, told Bloomberg. “There’s not enough to draw from to make a broad conclusion yet.”
In Europe, the Stoxx 600 Index finished the session with a fall that was less than 0.1 percent from the previous close. The UK’s FTSE 100 Index rose 0.1 percent, France’s CAC 40 Index gained 0.4 percent, while Germany’s DAX Index climbed 0.9 percent.
(BusinessDesk)
BusinessDesk.co.nz
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