Drug stocks lead equity rally

Big pharma led Wednesday's equity updraft, which was driven by a sweeping Republican victory in Tuesday's elections in the U.S. and a half a point interest rate cut by the Fed on Wednesday. Pharma stocks advanced 2.3% on the day as measured by the AMEX Pharma Index. The broad equity indexes also traded up on the day, with the NASDAQ, DJIA and the S&P 500 advancing 1.3%, 1.1% and 0.9%, respectively. The election gave both the U.S. Senate and the House of Representatives to the Republicans; a party that is viewed as more pro-business and less focused on advancing generic medicines than the Democrats.

The BioCentury 100 Index gained 1.2% on the day, with advancers ahead of decliners 75-23. Marring the biotech rally was bellwether Amgen (AMGN), which slipped $3.87 to $46.21 on 37.6 million shares after being downgraded to "hold" from "buy" by UBS Warburg's Meirav Chovav. She said the rating change was based on valuation and concerns over growth of AMGN's key products. AMGN also didn't help itself out by pushing back its business review meeting to Feb. 25 from Nov. 21, citing a desire to "better address several near term issues" including the supply issues surrounding Enbrel for rheumatoid arthritis, a decision on its litigation with Transkaryotic (TKTX) over gene-activated EPO and its efforts to "correct inaccuracies released in the CMS OPPS rule." ...