Stock trading on Thursday ended in different directions - investors chose between tech optimism and alarming signals in the healthcare sector.
Amid the wild fluctuations of April, caused by the intensification of trade confrontations between the United States and global partners, the S&P 500 index confidently regained its lost positions. Investors appear to have regained confidence as hopes for a diplomatic resolution to tariff disputes that threaten to accelerate inflation prevail.
Tech giant Cisco Systems shares soared nearly 5% after the company surprised Wall Street by raising its full-year guidance. The reason is a rapid increase in demand, fueled by the excitement around artificial intelligence solutions. Investor confidence has been strengthened, and Cisco shares have received an additional boost.
It was a very different day for UnitedHealth Group, whose shares fell 11%, falling to their lowest level in five years. The panic was triggered by a Wall Street Journal article that reported that the company had come under scrutiny from the US Department of Justice for potential fraud in the Medicare program, the federal health insurance system for senior citizens. UnitedHealth itself said it had not received any formal notification of an investigation from the government.
Walmart announced an upcoming price increase, citing the impact of import tariffs, which led to a 0.5% drop in its shares. This was made even though first-quarter sales in the U.S. exceeded analysts' expectations.
Amazon was also hit: the Internet giant's quotes fell by 2.4%, increasing pressure on the Nasdaq. Like Walmart, Amazon continues to suffer from the fallout from the Trump administration's trade decisions, causing concern among investors.
The world's largest retailer did not disclose its profit forecast for the second quarter, joining a growing number of companies that prefer to refrain from specifics amid economic turbulence. The epidemic of corporate caution is spreading, with more and more market players choosing to lay low, unwilling to make public bets amid an unstable tariff policy.
Walmart's decision only added to the overall mood on Wall Street: the business environment remains tense, and uncertainty about future costs is forcing even retail giants to reconsider their approaches.
Stock markets ended the day with mixed dynamics: the S&P 500 index added 0.41%, reaching 5916.93 points, while the tech-heavy Nasdaq fell 0.18%, stopping at 19,112.32 points. The Dow Jones Industrial Average, on the other hand, rose 0.65%, ending trading at 42,322.75 points.
The mixed sentiment reflected mixed sentiment in the market as investors sought to balance hopes for a reduction in inflationary pressures with concerns about the global economic outlook.
Among the 11 key industry sectors in the S&P 500, eight ended the day in positive territory. Utilities led the gains, up 2.1%, followed by the consumer staples sector, up 2%. Market participants are increasingly turning to safe havens and stable business models as a new strategy for survival in uncertain times.
Still, the S&P 500 remains about 4% below its all-time peak reached on Feb. 19, underscoring that the market has yet to fully recover from the pressures of the spring.
Economic data added ambiguity to the markets. US retail sales data for April showed a slowdown in consumer activity, while another report unexpectedly recorded a decline in producer prices. This happened against the backdrop of moderate consumer inflation data that had already been published earlier.
This picture gives grounds for debate among analysts: some see it as a sign of the economy cooling, while others see it as a reason to hope for a pause in the tightening of monetary policy.
Within the S&P 500 index, the ratio of stocks that showed growth to those that declined was almost 3 to 1. This indicates that, despite the alarming news and unstable data, market participants still retain a risk appetite and believe in the prospects of individual sectors.
European stock markets ended the week on a positive note, with investors encouraged by a temporary cooling of trade rhetoric between Washington and Beijing. The prospect of a respite in the protracted tariff war has increased appetite for risk assets, especially in defensive sectors.
The pan-European STOXX 600 index rose 0.4% in the early hours of Friday, demonstrating steady growth for the fifth week in a row. The main national stock exchanges opened in the green, and the German DAX index hovered near historical highs, reflecting the confidence of market participants.
The greatest support for the growth of European indices came from shares of companies working in the healthcare sector. The profile sub-index soared by 1.4%, becoming the leader among sectors. Particularly notable were the shares of pharmaceutical giants Novo Nordisk and Novartis, which continued to gain weight amid strong fundamentals and positive demand expectations.
Investors are cautious ahead of the publication of fresh macroeconomic statistics. The focus is on the eurozone trade balance data for March, as well as inflation figures for Italy. The reports expected later in the day could adjust market sentiment and affect the dynamics of the euro exchange rate.
There were some negative surprises: reinsurance group Swiss Re reported large losses caused by natural disasters. The damage from the devastating wildfires in the Los Angeles area that occurred earlier this year cost the company $570 million, which affected the quotes - Swiss Re shares lost 1.2% on the news.
Good news came from the world of high fashion and jewelry. The Richemont concern, which owns brands such as Cartier and Montblanc, reported a quarterly sales growth of 7% - slightly higher than analysts' forecasts. This led to a confident jump upwards: the company's shares rose by 4% in the first minutes of trading.
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