XAutoplay: On | OffStocks were broadly lower Tuesday afternoon, but biotechs led a rally in health care stocks.
The Nasdaq and S&P 500 were off 0.4% and the Dow Jones industrial average eased 0.1%.
Pharmaceuticals Merck (MRK) and Pfizer (PFE) led the Dow as drugmakers and some other health care stocks led the market. Merck added 2% and Pfizer climbed 1%, adding space above its conjoined 50-day and 200-day moving averages.
Small caps lagged, with the Russell 2000 off 0.9%. The Dow transports fared even worse, down 1.4%.
Volume was tracking higher across the board in the stock market today. Losers led winners by a 5-to-2 ratio on the NYSE and by a 2-to-1 ratio on the Nasdaq.
The energy sector was weakest after oil prices sank to a seven-month low, to $43.29 a barrel.
Chipotle Mexican Grill (CMG) plunged 6.5% in more than five times its average volume. Shares, which already had tumbled below the 50-day moving average, almost touched the 200-day line at the session low. The fast-casual restaurant chain gave an update on operations and outlook that caused investors to doubt that its recovery is on track.
Teladoc (TDOC) fell 6% in big volume as it came down from a record high. But the stock remains in a sharp upward trend. Late Monday, the company announced it is acquiring Best Doctors, a provider of consultations for patients with complex medical conditions, for $375 million in cash and $65 million of Teladoc stock.
Analysts at Canaccord Genuity praised the deal, calling it an “excellent transaction for Teladoc.” Analysts said it provides cross-selling opportunities in a plethora of medical subspecialties domestically and abroad and broadens the company’s offering into low-volume, high-acuity cases. “Furthermore, this transaction will differentiate Teladoc from its peers,” the analysts said.
Nvidia held on to a small price increase that left shares near a new high. Pacific Crest upgraded the stock to sector weight from underweight.
Amazon was up a fraction despite volume on track for a 40% increase over its average. The stock, a member of IBD Leaderboard, is extended after rising from support at the 50-day moving average.
Ulta Beauty (ULTA) also saw a big burst in volume and a small price increase of less than 1%. Yet, the cosmetics retailer is finding support after pulling back to the 50-day moving average for the second time since its May breakout.
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