Pfizer's surprise announcement of possible health risks connected with its Celebrex drug pushed stocks lower in heavy trading on Friday, renewing investors' concerns over the pharmaceutical sector. The three major indexes finished the week higher.
Wall Street drove Pfizer to a nearly seven-year low after the Dow component announced that a new study showed people taking high doses of Celebrex, the best-selling arthritis drug, had an increased risk of heart troubles. A similar revelation led to the removal of Merck & Co's competing Vioxx drug earlier this year -- and led to a major selloff of Merck shares. Pfizer said it will leave Celebrex on the market.
Despite moderate losses during the session, analysts remained bullish on the overall market.
"The nice thing about this market is that you may get a selloff of Pfizer, but the rest of the market behaves incredibly well," said Mark Bronzo, managing director of Gartmore Separate Accounts LLC.
"The market's acting like people want to be in it. So when you get something like this, people find other places to put their money and don't just sell everything," Bronzo said.
The Dow Jones industrial average fell 55.72, or 0.52 percent, to 10,649.92. Broader stock indicators also fell. The Standard & Poor's 500 index was down 8.99, or 0.75 percent, at 1,194.22, and the NASDAQ composite index lost 10.95, or 0.51 percent, to 2,135.20.
Stocks managed moderate gains during the week despite a sharp climb in oil prices. Investors were cheered by the Federal Reserve's positive statement on the economy, which came alongside Tuesday's quarter percentage point interest rate hike.
For the week, the Dow gained 106.70, or 1.01 percent; the S&P was up 6.22, or 0.52 percent; and the NASDAQ climbed 7.13, or 0.34 percent. Stocks have been up six of the last eight weeks.
Pfizer's announcement drew attention away from the Labor Department's consumer price index report for last month. The CPI rose 0.2 percent last month, coming off an 0.6 percent rise in October. "Core" CPI -- excluding food and fuel costs, which vary greatly -- also rose 0.2 percent for last month.
Stocks also saw pressure from crude oil futures, which shot past US$46 per barrel on concerns about higher demand due to a colder-than-expected winter. A barrel of light crude settled at US$46.28, up US$2.10, on the New York Mercantile Exchange.
The Russell 2000 index of smaller companies was down 0.15, or 0.02 percent, at 642.08.