Microsoft, other blue chip stocks rebound as biotech slide continues
NEW YORK — Stocks pushed mostly higher on Friday for the first time in three days.
The gains were modest as investors continued to cut their holdings in biotechnology stocks, some of the best performers of 2013. Instead, the stocks that advanced the most were mostly mature, large companies such as Microsoft, Exxon and Cisco Systems.
The Dow Jones industrial average rose 58.83 points, or 0.4 percent, to 16,323.06. The Standard & Poor's 500 index rose 8.58 points, or 0.5 percent, to 1,857.62. The Nasdaq composite, which includes a number of large biotech companies, rose 4.53 points, or 0.1 percent, to 4,155.76.
The biggest gainer in the Dow was Microsoft, which rose 94 cents, or 2.4 percent, to $40.30. The company announced Thursday that it is bringing Microsoft Office to the iPad and will shift its focus away from Windows, a move that analysts liked.
“We continue to view (Office on the iPad) as a massive revenue and operating profit opportunity for Microsoft,” analysts at Credit Suisse said in a report Thursday.
Microsoft helped lift other large technology companies, with Cisco Systems, Intel and Oracle up roughly 1 percent or more.
In contrast to technology, biotechnology had another horrible day. Gilead Sciences, Biogen Idec and Vertex Pharmaceuticals were all down 4 percent or more.
The higher they rise, the harder they fall, investors say. Biotechnology stocks had been among the hottest sectors in the stock market for the last two years, with the S&P 500 Biotechnology index rising 74 percent in 2013 and 38 percent in 2012.
That momentum stopped dead in the month of March. The S&P 500 Biotechnology index is down 12 percent this month alone, erasing all of the sector's gains in January and February.
The sell-off in biotech echoes the pullback investors have seen in speculative technology stocks, such as Twitter, Netflix and Tesla Motors. Those stocks are down between 14 percent and 20 percent this month alone.
“The high-momentum names have lost all the traction they had in the past year,” said John Fox, director of research at Fenimore Asset Management.
Investors will now turn their attention to next week's economic data, including the March jobs report due out Friday. Economists expect the U.S. economy, thawing from the harsh winter, created 200,000 jobs last month and the unemployment rate remained steady at 6.6 percent.
In other markets, the yield on the 10-year Treasury note hovered around 2.72 percent, up from 2.69 percent Thursday. The price of crude oil edged up 39 cents, or 0.4 percent, to $101.67 a barrel. Gold was little changed at $1,293.80 an ounce.