PFE Pfizer Inc

By Mark DeCambre and Victor Reklaitis, MarketWatch

The IBB is on track for its worst daily drop since October, Johnson & Johnson, Pfizer shares take it on the chin

The Dow industrials and the S&P 500 hit all-time highs in intraday trade ahead of a key meetings of European and U.S. central banks that have kept investors on a cautious footing.

A rapid advance in stock-market indexes since the Nov. 8 presidential election fueled a euphoric rally has raised some concerns that equity values have become overextended. A tumble in shares of health-care companies after comments from the U.S. president-elect and a second decline in crude-oil prices also has kept the market in check.

But the modest moves were sufficient to help the main indexes notch fresh intraday records.

The Dow Jones Industrial Average set an intraday trading record of 19,276.25 and most recently trading up 19 points, or 0.1%, higher at 19,271, on track for its third consecutive record close. A 1% rise in shares of Goldman Sachs Group(GS) helped to support the blue-chip benchmark, while a slump in health-care shares of Johnson & Johnson(JNJ)Pfizer Inc.(PFE), and Merck & Co. Inc.(MRK), tumbled after President-elect Donald Trump threatened to cut drug prices (http://www.marketwatch.com/story/president-elect-trumps-promise-to-bring-down-drug-prices-sends-biotech-etfs-slumping-2016-12-07). "I'm going to bring down drug prices," Trump told Time in his "Person of the Year" cover story (http://time.com/time-person-of-the-year-2016-donald-trump/). "I don't like what has happened with drug prices."

The iShares Nasdaq Biotechnology ETF(IBB), the most widely used way to place bets on the health-care and biotech space, sank 3.4%, and was on track for its worst daily decline since Oct. 11, according to FactSet data.

The IBB's drop weighed on the Nasdaq Composite Index which was the worst performer among the three main benchmarks, down 0.4% at 5,312.

The S&P 500 index set an intraday trading high of 2,214.29, exceeding its intraday high set Nov. 30, and was most recently up less than 0.1%, at 2,213, with all but one of the S&P 500's 11 sector in positive territory. Health-care led the way lower, with a 1.8%, decline.

On Tuesday, the S&P 500 finished 0.3% higher, within 0.1% of its Nov. 25 record close of 2,213.35. The Dow gained 0.2% and finished at an all-time high for a second straight session (http://www.marketwatch.com/story/dow-reaches-for-a-fresh-record-but-itll-be-a-struggle-2016-12-06). The Nasdaq Composite added 0.5%.

The stock market's postelection climb has been underpinned by hopes that Trump will follow through with a slate of pro-business policies, including boosting infrastructure spending and cutting taxes for the wealthy.

However, some strategists and traders are concerned that a pullback (http://www.marketwatch.com/story/gundlach-says-the-trump-trade-is-losing-steam-2016-12-02) might be in the offing.

"It appears that nothing can stop the equity rally," said Naeem Aslam, chief market analyst at ThinkMarkets UK, in a note.

"If you look at the volatility index, it has dropped near the 11 handle, which confirms that appetite for riskier assets is strong," he added, referring to the CBOE Volatility Index . "Buying volatility at these levels may not be that much of a bad idea."

Read:Why the rally by U.S. stocks is 'just getting started'--in one chart (http://www.marketwatch.com/story/why-the-rally-by-us-stocks-is-just-getting-started-in-one-chart-2016-11-28)

Other markets:European stocks (http://www.marketwatch.com/story/credit-suisse-miners-push-stoxx-europe-600-toward-highest-close-since-september-2016-12-07) gained, with banks and miners among the session's big winners, and Asian markets closed broadly higher (http://www.marketwatch.com/story/bank-stocks-surge-as-asian-markets-post-gains-2016-12-06). Oil futures (http://www.marketwatch.com/story/oil-prices-continue-to-backtrack-as-investors-question-opec-deal-2016-12-07) retreated, while gold futures and a key dollar index (http://www.marketwatch.com/story/dollar-flattens-out-as-investors-look-ahead-to-fed-ecb-meetings-2016-12-07) were modestly higher.

Individual stocks: Ahead of the opening bell, Brown-Forman Corp.(BFA) reported quarterly sales that topped estimates (http://www.marketwatch.com/story/brown-forman-sales-top-estimates-sticks-with-full-year-view-2016-12-07), as the maker of Jack Daniel's whiskey backed its full-year forecast. The stock wasn't yet active in premarket trade.

Handbag seller Vera Bradley Inc.(VRA) cut its full-year outlook (http://www.marketwatch.com/story/vera-bradley-shares-slump-as-company-cuts-outlook-2016-12-07) after missing its own guidance range for the third quarter. Shares were tumbling 11% in early trade.

Economic news: A report on consumer credit is due at 3 p.m. Eastern.

The JOLTS report, or Job Openings and Labor Turnover Survey, showed that job openings were unchanged at 5.5 million in October, according to Labor Department.

Investors also are bracing for the European Central Bank's policy-setting meeting (http://www.marketwatch.com/story/how-italys-no-vote-might-be-the-ecbs-silver-lining-2016-12-05) on Thursday. The Federal Reserve entered the so-called blackout period Tuesday ahead of its meeting Dec. 13-14, so there are no Fed speakers on the docket.

Check out:

(END) Dow Jones Newswires

December 07, 2016 10:37 ET (15:37 GMT)

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