US stocks skid as health care and tech are routed


NEW YORK (AP) — U.S. stocks are skidding Friday as drug companies take big losses following weak first-quarter reports. Technology companies are sinking for the second day in a row. The Nasdaq is set to fall for the seventh consecutive day.

KEEPING SCORE: The Dow Jones industrial average dropped 95 points, or 0.5 percent, to 17,735 as of 3:20 p.m. Eastern time. The Standard & Poor’s 500 index fell 15 points, or 0.7 percent, to 2,060. The Nasdaq composite index lost 39 points, or 0.8 percent, to 4,766. Losses over the last two days have nearly wiped out the Dow and S&P 500’s gains from earlier this month.

TAKEN ILL: Health care companies fell after a bout of weak earnings reports. Biotech drugmaker Gilead Sciences said its results were hurt by big discounts and rebates on its costly hepatitis C medicines, and its stock lost $8.52, or 8.8 percent, to $88.48. Rival biotech giant Amgen reported relatively solid results, but fell $2.59, or 1.6 percent, to $157.97.

Health insurer Molina Healthcare slashed its full-year guidance because of higher medical care costs in Ohio and Texas, expenses related to recent acquisitions, and pharmacy costs, especially in Puerto Rico. It plunged $13.03, or 20.3 percent, to $51.19.

Molecular diagnostics company Cepheid shed $6.79, or 19.2 percent, to $28.61 as analysts were disappointed with its revenue projections for the second quarter.

TECH TURMOIL: Tech stocks continued to slide. Electronic storage company Seagate Technology lost $5.09, or 18.9 percent, to $21.81 after its profit fell short of estimates. Hard drive maker Western Digital dropped $6, or 13 percent, to $40.06. Apple, which is in a deep two-week slide, fell another $1.44, or 1.5 percent, to $93.39. The world’s most valuable public company is close to its lowest price of 2016.

THE QUOTE: Tech stocks are now the worst-performing group of stocks on the market this year. Dan Suzuki, senior U.S. equities strategist at Bank of America, said investors don’t like what they’re seeing in tech company results.

“A lot of investors have been disappointed by results from tech this earnings season,” he said. So they are turning to bond-like stocks such as phone and utility companies, as well as small- and mid-cap stocks, which struggled in 2015.

“Everything that was working through last year has been an underperformer this year, and vice versa,” he said.

AMAZON STRONG: E-commerce giant Amazon said its revenue jumped 28 percent in the first quarter, and the company turned a far bigger profit than analysts expected. Cloud-based Amazon Web Services performed well. Its stock rose $54.92, or 9.1 percent, to $656.92.

BOOKED: Online travel company Expedia reported a bigger adjusted profit and greater sales than expected. Its stock added $8.86, or 8.3 percent, to $115.85. Despite the broad losses, consumer stocks were trading a bit higher on the strength of Amazon and Expedia stock.

CHANNEL CHANGER: Digital TV listing company Rovi will buy digital video recording company TiVo for about $1.1 billion in cash and stock. TiVo stock gained 53 cents, or 5.6 percent, to $9.95 and Rovi rose 24 cents, or 1.4 percent, to $17.59.

OVERSEAS: Stocks in Europe took big losses. Official data showed the eurozone economy rose by a surprising 0.6 percent in the first quarter, but investors were concerned that inflation slipped in April. France’s CAC 40 fell 2.8 percent and Germany’s DAX lost 2.7 percent. Britain’s FTSE 100 shed 1.3 percent.

Japanese markets were closed for a holiday. They plunged Thursday after the Bank of Japan held off on implementing any new economic stimulus measures. The yen strengthened, and that trend continued on Friday as the dollar fell to 106.73 yen from 108.09 yen. Hong Kong’s Hang Seng index fell 1.5 percent and Seoul’s Kospi gave up 0.3 percent.

CONSUMERS CAREFUL: Consumer spending edged 0.1 percent higher in March. Consumers spent more on clothing and less on long-lasting items like cars. Consumer spending has been weak this year, but employers keep hiring.

NO DEAL: Daily deals site Groupon reported strong results, but investors were disappointed that the company didn’t raise its annual revenue estimate. Most analysts expect greater revenue than Groupon is forecasting. Its stock sank 79 cents, or 17.9 percent, to $3.64.

DRINK UP: Energy drink maker Monster Beverage’s results surpassed analyst estimates, and the company said it will buy back $2 billion of its own stock from shareholders. It gained $16.72, or 13.1 percent, to $144.56.

METALS: Metals prices continued to rise. Gold advanced $24.10, or 1.9 percent, to $1,290.50 an ounce and silver rose 23 cents, or 1.3 percent, to $17.82 an ounce. Gold is trading at 15-month highs. Copper picked up 5 cents, or 2.3 percent, to $2.28 a pound.

ENERGY: Benchmark U.S. crude lost 11 cents to $45.92 a barrel in New York. Brent crude, used to price international oils, fell 10 cents to $48.13 a barrel in London.

OTHER ENERGY TRADING: Wholesale gasoline lost 1 cent to $1.58 a gallon. Heating oil fell 3 cents, or 1.9 percent, to $1.38 a gallon. Natural gas rose 10 cents, or 4.8 percent, to $2.18 per 1,000 cubic feet.

BONDS, CURRENCY: Bond prices rose slightly. The yield on the 10-year U.S. Treasury note fell to 1.82 percent from 1.83 percent. The euro rose to $1.1450 from $1.1351.

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at http://bigstory.ap.org/journalist/marley-jay

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