By Ankur Banerjee and Anya George Tharakan
(Reuters) - The S&P and the Dow Jones Industrial Average were higher in early afternoon trading on Friday, boosted by Nike's decision to sell on Amazon, while a fall in biotechnology stocks capped gains on the Nasdaq.
Nike shares <NKE.N> rose as much as 9.4 percent to a three-month high, after the world's largest footwear maker said it would launch a pilot program with Amazon.com <AMZN.O> to sell a limited product assortment on its website.
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The Nasdaq biotech index was down 0.71 percent, dragged lower by Regeneron <REGN.O> and Celgene <CELG.O>.
The S&P technology index <.SPLRCT> was up 0.28 percent but was still on track to post its biggest weekly loss in six months as worries about the sector's valuation prompted investors to buy defensive stocks.
"Tech has gone too far too fast and was due for a correction," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management.
"The sector's valuation is elevated but hasn't reached a point of extreme concern because it is still a 'buy-the-dip' sector and is expected to grow further."
A fall in bank shares kept the financial sector <.SPNY> flat with Wells Fargo <WFC.N> and Goldman Sachs <GS.N> dragging down the S&P and the Dow.
All three indexes are on track to post weekly losses.
At 12:40 p.m. ET (1640 GMT), the Dow Jones Industrial Average <.DJI> was up 78.87 points, or 0.37 percent, at 21,365.9, the S&P 500 <.SPX> was up 6.23 points, or 0.25 percent, at 2,425.93.
The Nasdaq Composite <.IXIC> was up 7.41 points, or 0.12 percent, at 6,151.76.
The consumer discretionary index <.SPLRCD> rose 0.72 percent and led the gainers among the major sectors.
With the Federal Reserve keen on further raising the interest rates this year despite inflation remaining below their 2 percent target, investors have been keeping an eye on economic data for clues on the state of the economy.
Earlier in the day, data showed U.S. consumer spending rose modestly in May while inflation cooled. Even so, another set of data showed the University of Michigan consumer sentiment index at its lowest since November.
"In the next four to six weeks we'll get another set of economic data that will tell us if the Fed is justified in raising rates again this year," said Sandven.
Toward the end of the second quarter, the market witnessed a few volatile days with the S&P 500 and the Dow recording their worst daily percentage drop in about six weeks on Thursday.
Oil prices climbed for the seventh straight session on Friday in their longest bull run since April, but were still set for the worst first-half performance since 1998. [O/R]
Micron <MU.O> reversed gains to fall 4.1 percent even after the chipmaker forecast better-than-expected profit and revenue for fourth quarter
Advancing issues outnumbered decliners on the NYSE by 1,690 to 1,145. On the Nasdaq, 1,458 issues fell and 1,310 advanced.
(Reporting by Ankur Banerjee, Anya George Tharakan and Tanya Agrawal in Bengaluru; Editing by Arun Koyyur)