Wall Street Ends Lower on Slump in Biotech


Wall Street Ends Lower on Slump in Biotech

US stocks ended lower for the fourth straight session weighed down by a fall in material, biotech and commodities despite surprisingly strong quarterly results by Amazon, Starbucks and Visa.

The Dow Jones Industrial Average ended 129.39 points or 0.92% lower at 17,569.53 points falling more than 2.9% for the week, its biggest weekly decline since December.

The S&P 500 index ended 22.50 points or 1.1% lower at 2,079.65 points with six of its ten key sectors ending lower. Materials led the declines with a 1.79% decline.

The benchmark index ended 2.2% lower on the week, its steepest weekly decline in more than three months.

The Nasdaq Composite dropped 57.58 points or 1.1% to end at 5,088.69 points ending 2.3% lower for the week.

“Certainly the ongoing collapse in commodity prices emanating from weak data in China and weak earnings reports from companies because of China, such as Caterpillar, are weighing on the market,” Jim Paulsen, the Minneapolis-based chief investment strategist at Wells Capital Management Inc. His firm oversees $351 billion, told Bloomberg.

“We’ve got a pretty big collapse going on here.”

Biotechnology stocks led the declines with Biogen which slumped 22% o a worse than expected sales outlook for the year. The pullback outweighed a 9.8% jump by Amazon shares on better than expected earnings.

The focus on individual companies on Friday marks a complete shift in focus from a month ago when the market was moved by china’s tumbling equity markets and developments in Greece.

“The market has taken a break from the macro[economic] and is focusing more on the company level,” Tom Digenan, head of U.S. equities at UBS Global Asset Management, told the Wall Street Journal.

“If you have a bad quarter, that doesn’t necessarily project that things will be all bad going forward, but the market seems to be playing that.”

Also weighing the stocks down was a selloff by commodities with metals plunging on concerns that the worse than expected economic data form Chin and Europe was a reflection of the state of the global economy.

To contact the reporter of the story: Samuel Rae at samuel@forexminute.com