Stocks waver as chipmakers jump and drug companies dip

Stocks finished mostly higher Thursday as another day of mixed trading showed the market’s recent rally losing some strength. Chipmakers rose, while drugmakers fell.

Chipmakers Xilinx and Lam Research soared and many of their peers also climbed as investors, many of whom have been pessimistic about demand for computer chips recently, saw signs of life in the business. The Philadelphia Semiconductor Index rose to its highest level since early December. Airlines also rose after several strong quarterly reports.

Drugmakers including Merck and Pfizer took sharp losses, and spice manufacturer McCormick had its biggest drop in 13 years. Other household products companies also sank.

The S&P 500 index rose 3.63 points, or 0.1%, to 2,642.33. The benchmark U.S. index is up 12.4% over the last month, but it’s slipped 1.1% this week after big gains in each of the last four weeks. The Dow Jones industrial average dipped 22.38 points, or 0.1%, to 24,553.24.

Thanks to the big gains for technology companies, the Nasdaq composite added 47.69 points, or 0.7%, to 7,073.46. The Russell 2000 of small-company stocks gained 10.15 points, or 0.7%, to 1,464.41.

Xilinx surged 18.4% to $106.06 after its third-quarter results topped expectations. The company said it’s benefiting from the expansion of 5G wireless networks in South Korea and preparations for deployment in China and North America, while several automakers are talking about using Xilinx products in autonomous cars. It made its biggest gain in 27 years.

Lam Research gained 15.7% to $161.20, its best day in 14 years, and Texas Instruments rallied 6.9% to $102.09 after their reports. Intel, the world’s largest chipmaker, gained 3.8% to $49.76.

But if the companies are on the road to recovery, the ride doesn’t look smooth. Intel tumbled 7.1% in aftermarket trading after its fourth-quarter results and its forecasts for the current year both disappointed investors.

American Airlines rallied 6.4% to $33.66 after reporting solid results in its latest quarter, and Southwest climbed 6.3% to $54.21. Southwest said the partial shutdown of the federal government could cost it up to $15 million in revenue this month, echoing Delta’s statement that it could lose $25 million in revenue. While that’s noticeable, it’s a relatively small portion of the airlines’ total revenue.

Among drug companies, Merck fell 3% to $73.17 and Pfizer lost 2.9% to $40.95, while Eli Lily slid 3.2% to $114.99.

McCormick slumped 10.5% to $124.35 after its quarterly profit and revenue both fell short of expectations. Investors were also disappointed with the spice and seasonings company’s forecasts for 2019. The company has dramatically outperformed the broader stock market for the last few decades, and Thursday was its largest loss since September 2005.

Pacific Gas & Electric Co. surged 74.6% to $13.95 after investigators ruled that the utility company was not at fault for a Northern California wildfire that killed 22 people in 2017. The stock has plunged since November on concerns the company might be liable for billions of dollars in damages caused by that fire and for the Camp fire of 2018, which killed at least 86 people and destroyed 15,000 homes. Those potential liabilities pushed the company to file for bankruptcy this month.

The European Central Bank did not change its interest rates or its projection for when it might start raising them. European Central Bank head Mario Draghi says risks to the European economy are increasing and the bank is ready to “adjust all of its instruments” if it runs into serious trouble.

Bond prices moved higher. The yield on the 10-year Treasury note fell to 2.71% from 2.75%.

U.S. crude oil rose 1% to $53.13 per barrel in New York. Brent crude, used to price international oils, slipped 0.1% to $61.09 per barrel in London.

The dollar edged up to 109.67 yen from 109.59 yen. The euro fell to $1.1299 from $1.1383.