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GLOBAL MARKETS-Healthcare limits stock gains; oil prices drop on weak demand forecast

Published 12/07/2019, 05:12 am
Updated 12/07/2019, 05:20 am
GLOBAL MARKETS-Healthcare limits stock gains; oil prices drop on weak demand forecast
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* Healthcare caps gains on Wall Street

* U.S. Treasury yields rise after auction of 30-year bonds

* Oil prices ease from multi-week highs

* Asian stock markets: https://tmsnrt.rs/2zpUAr4 (Updates to mid-afternoon in U.S. markets)

By April Joyner

NEW YORK, July 11 (Reuters) - A broad index of stocks around the world pared gains slightly on Thursday as healthcare shares limited Wall Street's rise, while oil prices turned lower on a forecast for weaker demand.

The U.S. benchmark S&P 500 stock index was little changed. Shares of pharmaceutical companies fell after the administration of U.S. President Donald Trump withdrew a rule that would have required health insurers to pass on rebates from drugmakers. Conversely, financial shares rose as bond yields jumped following soft demand in an auction of $16 billion in 30-year Treasuries. withdrawal of the rule regarding drug rebates benefited shares of insurers and pharmacy benefit managers, which boosted the Dow Jones Industrial Average. The Dow crossed the 27,000 mark for the first time during the session.

MSCI's gauge of global stocks was up 0.13%.

"The pharma space is having a bad day. The market would be quite a bit higher if it weren't for that," said Jamie Cox, managing partner at Harris Financial Group in Richmond, Virginia. "Investors are starting to get worried as the (U.S.) election season approaches, and the first and most prominent punching bag is pharma."

Oil prices also retreated from early gains after the Organization of the Petroleum Exporting Countries forecast less demand for its crude next year. Earlier in the session, they had hit their highest levels in more than a month. crude futures CLc1 settled 23 cents lower, or 0.38%, at $60.20 a barrel. Brent crude futures LC0c1 settled down 49 cents, or 0.73%, at $66.52 a barrel.

On Wall Street, the Dow Jones Industrial Average .DJI rose 172.94 points, or 0.64%, to 27,033.14, the S&P 500 .SPX gained 1.73 points, or 0.06%, to 2,994.8 and the Nasdaq Composite .IXIC dropped 14.12 points, or 0.17%, to 8,188.42.

U.S. shares had previously hit record highs after Federal Reserve Chairman Jerome Powell confirmed the U.S. central bank stood ready to "act as appropriate" in response to risks to the U.S. economy, including disappointing factory activity, tame inflation and a simmering trade war with China.

Powell spoke before the Senate Banking Committee on Thursday following similar testimony before the House of Representatives Financial Services Committee on Wednesday. jitters stymied European stocks. The STOXX 600 .STOXX ended 0.12% lower as warnings from small-cap auto and industrial suppliers pushed down shares of car parts companies.

In fixed-income markets, benchmark 10-year U.S. Treasury notes US10YT=RR last fell 18/32 in price to yield 2.1221%, from 2.061% late on Wednesday.

Previously, Treasury yields had crept up marginally after data showed the biggest gain in U.S. underlying consumer prices in 1-1/2 years. The data, however, did not change expectations for a rate cut from the Fed. dollar index .DXY , which measures the greenback against a basket of six major currencies, dipped slightly amid prospects for a Fed rate cut. It was last down 0.05%. Japanese yen JPY= and the euro EUR= were near flat against the dollar.

Spot gold XAU= fell 0.80% to $1,407.40 an ounce on stronger-than-expected U.S. inflation data.

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