Technology, industrials lead US stocks higher

Traders working on the floor of the New York Stock Exchange.
Traders working on the floor of the New York Stock Exchange. PHOTO: AFP

NEW YORK (AFP) - Industrial and technology shares rallied on Friday, offsetting big declines in pharmaceutical equities as US stocks finished modestly higher for the day in an otherwise downbeat week.

Art Hogan, chief market strategist at Wunderlich Securities, said the biggest winners on Friday were sectors that had suffered deep losses earlier in the week, including technology, materials and industrials.

But a disappointing outlook from Endo International raised worries about drug pricing weakness. Endo flopped 39.2 per cent. Fellow drugmakers Allergan, Teva and Mylan all fell 4 per cent or more.

The Dow Jones Industrial Average rose 0.5 per cent to 17,740.63.

The broad-based S&P 500 climbed 0.3 per cent to 2,057.14, while the tech-rich Nasdaq Composite Index advanced 0.4 per cent to 4,736.16.

US stocks initially fell after the Labour Department reported the US added just 160,000 jobs last month, much below the six-month average of 242,000 jobs per month.

But stocks pushed into positive territory in the early afternoon. Hogan attributed the shift to a technical bounce-back after sharp falls earlier in the week.

Technology stocks that gained included Amazon, up 2.3 per cent, Facebook, up 1.4 per cent, and Tesla Motors, up 1.6 percent. Apple dropped 0.6 per cent.

Other winners were General Electric, up 0.8 per cent, and gold and copper producer Freeport-McMoRan, up 4.4 per cent.

Video game developer Activision Blizzard climbed 8.5 per cent after reporting better-than-expected first-quarter earnings as monthly average user figures reached an all-time high of 55 million, up 10 per cent from the year-ago period.

Valeant Pharmaceuticals International sank 13.3 per cent after announcing it formed a new drug pricing committee to be led by new chief executive Joseph Papa. Papa said the move was needed to correct earlier mistakes with excessive drug pricing.

Herbalife, which sells health supplements and weight-loss products, surged 9.1 per cent as it announced it is in advanced stages of settling with the US Federal Trade Commission an investigation into the company's marketing practices.

Herbalife said it could be forced to pay US$200 million (S$270 million) in a settlement. Analysts welcomed the news of a possible resolution to the case.

Online payments company Square plunged 21.7 per cent after reporting a loss for the first quarter of US$96.8 million, more than double a year ago.