Nasdaq ends lower as Wall Street rally fizzles

NEW YORK (AFP) - Strong earnings from Nike lifted the Dow Friday, while weakness in many tech names pushed the Nasdaq lower as a morning rally in US stocks fizzled.

The Dow Jones Industrial Average rose 113.35 points (0.70 per cent) to 16,314.67.

The broad-based S&P 500 slipped 0.90 (0.05 per cent) to 1,931.34, while the tech-rich Nasdaq Composite Index fell 47.98 (1.01 per cent) to 4,686.50.

US stocks opened solidly higher after Federal Reserve chairman Janet Yellen said she still expects to raise interest rates in 2015.

But stocks weakened throughout the day, with technology and biotechnology names sustaining some of the biggest hits. Facebook dropped 1.7 per cent, Google fell 2.2 per cent and Gilead Sciences lost 2.3 per cent.

Health care stocks were also weak, with Dow member UnitedHealth Group tumbling 3.9 per cent, Aetna shedding 3.8 per cent and drugmaker Pfizer losing 2.5 per cent.

Analysts said the market remains edgy owing to concerns about global growth and uncertainty about US monetary policy.

Investors may also fear a higher chance of US government shutdown with the surprise resignation of Republican House Speaker John Boehner, analysts said.

"I think this volatility will be with us for a while," said Mace Blicksilver, director of Marblehead Asset Management.

Dow member Nike surged 8.9 per cent after earnings for the quarter ending Aug 31 jumped 22.6 per cent to US$1.2 billion (S$1.7 billion).

Earnings translated into US$1.34 per share, much above the US$1.19 projected by analysts.

Large banks gained, including Dow member JPMorgan Chase (+2.1 per cent), Citigroup (+2.9 per cent) and Wells Fargo (+1.8 per cent).

Smartphone maker BlackBerry sank 7.7 per cent as it reported that second-quarter sales slumped nearly 50 per cent to US$489 million.

The company also said it would sell an Android-powered smartphone in its latest attempted corporate reboot.

Bond prices fell. The yield on the 10-year US Treasury rose to 2.17 per cent from 2.13 per cent Thursday, while the 30 year bond advanced to 2.96 per cent from 2.92 per cent. Bond prices and yields move inversely.