Stock Market News For August 25, 2016

Benchmarks ended in the red on Wednesday following decline in Mylan’s shares, which had a negative impact on the biotech stocks and eventually on the broader healthcare sector. Strong political pressure on Mylan (NASDAQ:MYL) for over-pricing its life saving drug, EpiPens, led the shares of the company to fall. Moreover, bigger-than-expected rise in crude inventories also weighed on investor sentiment. Both the Dow and S&P 500 reached their lowest settlements since early Aug and the Nasdaq witnessed its biggest one-day percentage fall in last three weeks and settled at its lowest level since Aug 8.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) decreased 0.4%, to close at 18,481.48. The S&P 500 fell 0.5% to close at 2,175.44. The tech-laden Nasdaq Composite Index closed at 5,217.70 losing 0.8%. The fear-gauge CBOE Volatility Index (VIX) increased 8.6% to settle at 13.45. A total of around 6.09 billion shares were traded on Wednesday, lower than the last 20-session average of 6.26 billion. Decliners significantly outpaced advancing stocks on the NYSE. For 68% stocks that declined, 29% advanced.

What Dragged the Benchmarks?

Shares of Mylan N.V. (MYL) slumped 5.5% after U.S. senators raised questions over inflated prices of its epinephrine auto-injector, EpiPen, which is approved for the treatment of severe allergic reactions (read more: Mylan Draws Flak for Over Pricing EpiPen, Stock Down).

Declines in Mylan led the iShares Nasdaq Biotechnology (IBB) to decrease 3.4%. Key holdings from the sector including, Gilead Sciences Inc (NASDAQ:GILD). ( GILD), Illumina Inc (NASDAQ:ILMN). (ILMN), Vertex Pharmaceuticals (NASDAQ:VRTX) Incorporated (VRTX) and Endo International plc ( ENDP) decreased 1.2%, 1.9%, 4.2% and 6.6%, respectively. The Health Care Select Sector SPDR ETF (NYSE:XLV) fell by 1.6%, posting its worst percentage fall since June 24, and was the biggest loser among the S&P 500 companies.

Additionally, the U.S. Energy Information Administration (EIA) reported that the U.S. commercial crude oil inventories rose 2.5 million barrels to 523.6 million for the week ended August 19, higher than analysts’ projections of an increase of 200,000 barrels.

WTI crude fell 2.8% to $46.77 per barrel. Brent crude also declined 1.9% to $49.05 a barrel. Decrease in oil prices led the Energy Select Sector SPDR (XLE (NYSE:XLE)) to fall 0.4%. Further, the Materials Select Sector SPDR (XLB) decreased 1.2% and was second worst performer among S&P 500 sectors.

Also, investors remained cautious ahead of Fed Chairwoman Janet Yellen’s speech at Jackson Hole, Wyoming tomorrow.

Moreover, sales of existing homes declined 3.2% in July from June to a seasonally adjusted rate of 5.39 million, according to the National Association of Realtors. This was lower than the consensus estimate of 5.57 million and June’s figure of 5.52 million.

Stocks that Made Headlines

CNOOC Incurs Loss in 1H16; Revenues Decrease Y/Y

Chinese offshore giant, China National Offshore Oil Corp. or CNOOC (CEO), reported net loss for the first half of 2016. The downside primarily stemmed from a substantial decline in realized oil prices. ( Read More)

HP Inc Tops Q3 Earnings & Revenues, Cuts 2016 View

HP Inc. (HPQ) reported better-than-expected results for the third quarter of fiscal 2016, wherein both its top line and bottom line surpassed the respective Zacks Consensus Estimate. ( Read More)

PVH Corp (NYSE:PVH). Beats on Q2 Earnings, Raises EPS View

PVH Corporation (PVH) delivered another strong quarter with second-quarter fiscal 2016 earnings per share surpassing estimates for the ninth consecutive quarter. ( Read More)

SeaDrill Q2 Earnings Beat, Revenues Miss Estimates

Offshore contract driller, SeaDrill Limited (SDRL), reported strong second-quarter 2016 earnings owing to a decrease in operating expenses. However, it registered poor quarterly revenues due to underperformances by Jack-up Rigs and Floaters. ( Read More)

Fitbit Wins Latest Round of Legal Fight against Jawbone

Fitbit Inc. (FIT) has received a favorable ruling in the latest round of the Jawbone trade secret case. (Read More)