Most U.S. stocks went up on Thursday, but a major drop in UnitedHealth Group’s shares held Wall Street back.
The S&P 500 rose just 0.1%, even though about 75% of stocks in the index gained. The Nasdaq composite dipped 0.1%, showing more stability after a sharp fall the day before.
The Dow Jones Industrial Average fell by 527 points, or 1.3%, mainly because of UnitedHealth Group. Its stock fell 22.4%, its biggest drop since 1998, after reporting weaker profits than expected.
Eli Lilly helped lift the market, jumping 14.3% after sharing good results for a daily pill that may help treat obesity and diabetes.
Energy stocks climbed too, as oil prices bounced back from earlier losses this month. Diamondback Energy rose 5.7%, and Halliburton gained 5.1%.
Technology shares held up better after Taiwan Semiconductor Manufacturing Co. reported profit in line with forecasts. The company, called TSMC, also said it hasn’t yet seen customers slow down due to President Donald Trump’s trade war, though it remains cautious.
“While we have not seen any changes in our customers’ behavior so far, uncertainties and risks from the potential impact from tariff policies exist,” said Chief Financial Officer Wendell Huang. TSMC’s U.S.-traded stock rose 0.1%.
These gains helped soften the blow from UnitedHealth, which lowered its financial outlook for the year. The company said it was surprised by higher-than-expected medical care usage by its Medicare Advantage customers.
Nvidia was another big drag. It fell for the second day in a row, dropping 2.9%, after saying export restrictions on chips to China could hurt its first-quarter results by $5.5 billion.
By the end of trading, the S&P 500 gained 7.00 points to 5,282.70. The Dow dropped 527.16 to 39,142.23, and the Nasdaq slipped 20.71 to 16,286.45.
There is still a lot of uncertainty around tariffs. Trump wants to bring manufacturing jobs back to the U.S. and reduce the trade deficit. Economists warn that keeping tariffs in place too long could lead to a recession.
Trump gave investors some hope Thursday by suggesting that talks with other countries might result in lower tariffs.
Still, the ongoing changes in Trump’s tariff plans alone could harm the economy. On Wednesday, Federal Reserve Chair Jerome Powell said again that tariffs seem larger than the Fed had expected, which could slow the economy and increase inflation more than previously thought.
Traders in NYSEThat creates a problem for the Fed. Lowering interest rates could help the economy, but it might worsen inflation. Powell said the Fed will wait to see how things go before making any rate changes.
Trump criticized the Fed’s approach Thursday, saying it is “always TOO LATE AND WRONG,” and added, “Powell’s termination cannot come fast enough!”
That could worry investors. A Fed that operates independently from political pressure has helped make the U.S. a trusted place for investment. History shows that countries with more independent central banks tend to have lower and steadier inflation.
Research suggests Trump’s earlier calls for lower rates may have influenced market expectations, possibly nudging the Fed in that direction. But this time, with inflation not as low as during Trump’s first term, the situation is different.
“This request for lower rates could backfire if markets perceive that going forward the Fed will be less committed to low and stable inflation,” said Francesco Bianchi, an economics professor at Johns Hopkins University.
In the bond market, the yield on the 10-year Treasury went up to 4.32% from 4.29% on Wednesday. Yields had been falling most of this week, recovering from a jump last week that shook investors. That spike had raised fears that Trump’s fast-changing trade decisions might be making U.S. investments seem less safe.
Economic reports released Thursday gave mixed signals. One report showed fewer people applied for unemployment benefits than expected, suggesting a strong job market. But another showed that manufacturing in the mid-Atlantic region shrank unexpectedly.
Stock markets in Europe fell, with indexes down 0.6% in France and 0.5% in Germany. Even though the European Central Bank cut interest rates—a move that often boosts stocks—investors had already expected it.
Markets in Asia did better. Stocks rose 1.6% in Hong Kong and 1.3% in Japan.
