(Education stocks and final gainful employment ruling report updated with additional commentary).
NEW YORK (TheStreet) -- Stocks in the education sector pulled back somewhat on Friday after the Department of Education released its long-awaited final ruling on gainful employment regulations Thursday, sparking a sector rally.
Analysts largely viewed the final ruling as less strict than expected for for-profit education providers -- many schools won't have to institute complete overhauls of their business practices as first feared -- lifting stocks in the sector much higher in early trading.
Stocks in the sector surged on Thursday following the DOE's announcement. By Friday however, investors were cashing in on their gains ahead of the weekend.
Everest Colleges' parent Corinthian Colleges (COCO) led the sector in terms of volume, falling 1.6% to $4.98 ahead of midday. More than 3.2 million shares changed hands less than halfway through Friday's session, compared with their average daily volume of just 2.8 million.University of Phoenix parent Apollo Group (APOL) lost 0.9% to $46.50, DeVry (DV) fell 1.5% to $60.93 and Strayer Education (STRA) edged 0.1% lower to $144.82. ITT Educational (ESI) continued to gain, rising 0.4% to $86, while Education Management (EDMC) added 0.9% to $24.98 and Career Education (CECO) rose 2.5% to $24.69.
The gainful employment rule was expected to cut federal aid to schools such as DeVry University or Apollo Group's University of Phoenix if more than 65% of students were unable to repay hefty loans. The ruling came as part of a larger push by the Obama administration to protect students from taking on too much debt, and then finding themselves unqualified or unable to get the jobs they would need to repay those loans.
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