By Sruthi Shankar
(Reuters) - A jump in Apple and other technology stocks sent the three major Wall Street indexes to record highs on Friday, but a drop in health insurers and hospital operators kept the rally in check.
Shares of big banks were little changed after mixed reports from Bank of America and Wells Fargo.
Bank of America (N:BAC), the second-biggest U.S. bank by assets, rose 1.4 percent after the lender's profit topped estimates due to higher interest rates and a drop in costs.
But Wells Fargo (N:WFC) tumbled more than 3 percent, set for its biggest drop since mid-April, after reporting lower-than-expected revenue for the fourth straight quarter due to a decline in mortgage banking revenue.
The reports from the Wall Street banks kicked off the third-quarter earnings season, with investors hoping profit growth will help justify valuations after a rally that has sent the S&P 500 up about 14 percent so far this year.
"Because of the reach that financials have into the economy, the market likes to see its what earnings are reflecting, be it on loan growth, it's really trying to look at the health of the economy," Nana Adae, global investment specialist, J.P. Morgan Private Bank in Chicago.
The market got a boost earlier in the day after data showed retail sales surged by the most in 2-1/2 years in September, while consumer prices recorded their biggest increase in eight months as Hurricanes Harvey and Irma boosted demand.
While the data was below estimates on both counts and failed to move year-on-year core inflation for the fifth straight month, it did little to derail expectations of an interest rake hike in December.
"While the inflation data might seem a little bit soft, in general it did not derail the Fed's plans to continue to normalize rates. And as we move toward normalization, the market is positive about that," said Adae.
At 12:39 a.m. ET (1639 GMT), the Dow Jones Industrial Average (DJI) was up 37.69 points, or 0.17 percent, at 22,878.7, the S&P 500 (SPX) was up 4.82 points, or 0.19 percent, at 2,555.75 and the Nasdaq Composite (IXIC) was up 19.50 points, or 0.3 percent, at 6,611.01.
That set the S&P and the Dow on track to close higher for the fifth straight week and the Nasdaq for the third.
Six of the 11 major S&P sectors were higher, led by a 0.7 percent gain in the technology index (SPLRCT), which had led much of the market's rally this year.
The gains were led by Apple (O:AAPL) and Facebook (O:FB) and Microsoft (O:MSFT), which rose between 0.45 percent and 1 percent.
Netflix (O:NFLX) shares were up 1.47 percent, hitting a record high at $200.81, after a slew of price target increases ahead of its earnings report on Monday.
The healthcare sector (SPXHC) was down 0.33 percent as health insurers and hospital operators tumbled on news that President Donald Trump scrapped billions of dollars in Obamacare subsidies to private insurers for low-income Americans.
Centene (N:CNC) sank 4.44 percent, Molina Healthcare (N:MOH) dropped 3.93 percent and Anthem (N:ANTM) fell 4.42 percent.
Tenet Healthcare (N:THC) retreated 4.3 percent and Community Health System (N:CYH) declined 5 percent.
Advancing issues outnumbered decliners on the NYSE by 1,773 to 1,038. On the Nasdaq, 1,481 issues rose and 1,323 fell.