The S&P healthcare index rose 1 per cent on Thursday, hitting its fifth consecutive record close following the release of Senate Republicans' Bill to replace Obamacare, while financial and consumer staple shares ended lower.
The legislation aims at curbing Medicaid funding and reshaping subsidies to low-income people for private insurance. The index has risen 3.9 per cent in five days.
The Nasdaq biotechnology index rose 1.3 per cent, for a 9.4 per cent jump so far this week. While it was not clear whether the Bill would get enough support to become law, drug stocks were among the S&P 500's biggest gainers, with Gilead rising 4.4 per cent on Thursday.
“The initial proposal I think is more generous and more positive to the industry than expected,” said Jeff Jonas, portfolio manager with Gabelli Funds.
The Dow Jones Industrial Average gave up early gains to end down 12.74 points, or 0.06 per cent, at 21,397.29. The S&P 500 lost 1.11 points, or 0.05 per cent, to 2,434.5 and the Nasdaq Composite added 2.73 points, or 0.04 per cent, to 6,236.69.
The S&P energy index ended down 0.1 per cent after recording 3.5 per cent of losses in the previous three sessions on falling oil prices.
“Oil's had a tough run in the last handful of weeks. I wouldn't say oil being up today gives anybody a high degree of confidence we've seen a floor in oil yet,” Michael Scanlon, managing director, portfolio manager at Manulife Asset Management in Boston.
Thursday's gains were muted as and investors looked forward to the second-quarter earnings season.
“US equities are trading at somewhat rich valuations," said Jason Pride, director of investment strategy at Glenmede in Philadelphia. “With earnings coming up that should provide upside pressure to stocks, but the valuations provide a counterbalance to that.”
Stress test
The S&P bank index was down 0.6 per cent ahead of the release of the sector's annual stress test results, released after the market close. Bank shares remained unchanged after the news.
“Going into this quarter you've had negative guidance out of the banks that the trading environment hasn't been so good. I think the market's going to be a bit more choppy over the next few weeks,” said Manulife's Scanlon.
The consumer staples sector ended down 0.7 per cent and was the second-biggest drag on the S&P behind financials.
Economic data on Thursday showed jobless claims for last week increased by 3,000 to 241,000, but remain at levels consistent with a tight labour market.
Oracle's 8.6 per cent rise to $50.30 provided the S&P with its biggest boost after the company forecast an upbeat current-quarter profit.
Accenture fell 3.9 per cent after the consulting and outsourcing services provider trimmed its annual revenue forecast.
Tesla was up 1.6 per cent at $382.61 after the company said it was in exploratory talks with the Shanghai municipal government to establish an electric vehicle manufacturing plant in China.
Advancing issues outnumbered declining ones on the NYSE by a 1.41-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favored advancers.
More than 6.65 billion shares changed hands on US exchanges, compared with a 6.95 billion average for the last 20 sessions.