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US STOCKS-Wall St turns higher as momentum shares rebound
May 9, 2014 / 5:40 PM / 4 years ago

US STOCKS-Wall St turns higher as momentum shares rebound

* Apple reportedly close to deal for Beats Electronics

* Momentum shares like Gilead, Netflix rise

* Dow up 0.2 pct, S&P up 0.1 pct, Nasdaq up 0.3 pct (Updates to afternoon)

By Caroline Valetkevitch

NEW YORK, May 9 (Reuters) - U.S. stocks edged higher on Friday, rebounding from earlier losses along with high-growth momentum shares, while Merck and other healthcare names gained ground.

Merck shares rose 1.1 percent to $55.39, a day after U.S. health regulators approved a blood clot preventer developed by Merck for use by patients who have had a heart attack or who suffer from blockages in the arteries of the legs. The S&P healthcare index was up 0.6 percent.

Shares of Gilead were up 1.1 percent at $79.62 while shares of Priceline were up 1.6 percent at $1,126.86. Netflix Inc shares rose 0.9 percent to $324.56 after it increased the price of its most popular video streaming plan by $1 a month.

“We’ve seen days of investors trying to see if there’s a bottom in these Nasdaq stocks,” said Rick Meckler, president of hedge fund LibertyView Capital Management in Jersey City, New Jersey.

“There’s some fear among investors that their steep fall-offs are a precursor of something to the broader market, and when they rebound, even temporarily, it seems to give confidence to the overall market. But this has been going on now for a lot of couple of weeks.”

The S&P 500 has alternated between gains and losses each day this week, and the Nasdaq has dropped for three straight sessions - its longest losing streak since early April - as Internet-related stocks came under pressure.

The Dow Jones industrial average rose 31.63 points or 0.19 percent, to 16,582.6, the S&P 500 gained 1.95 points or 0.1 percent, to 1,877.58 and the Nasdaq Composite added 11.883 points or 0.29 percent, to 4,063.379.

The Russell 2000 of small-cap companies also turned positive and was last up 0.6 percent. Earlier, it touched correction territory with a 10 percent drop from its March 9 high before bouncing slightly. A drop of that magnitude on a closing basis could spark more investor caution.

The S&P and Nasdaq were still on track to post declines for the week.

Apple Inc remained the biggest drag on both the benchmark S&P index and the Nasdaq 100 on news it is close to paying a record $3.2 billion for Beats Electronics, two people with knowledge of the matter said, an expensive foray into music streaming and headphone gear.

Some analysts questioned whether Beats, valued at $1 billion during its last funding round in September, was worth that price. Apple shares lost 1.2 percent to $581. (Additional reporting by Herbert Lash and Chuck Mikolajczak; Editing by Bernadette Baum and Nick Zieminski)

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