Dow Jones lost 178 points, lowering profit expectations from major US healthcare companies.
The stock market is rallying thanks to the removal of tariffs in China and the US, but Dow Jones is still behind. On Tuesday, May 13th, the S&P 500 entered the positive territory of 2025 with a 5,893 points, 50 points or 0.85% increase.
At the same time, the Dow Jones fell 159.43 or 0.38% with 42,250.67 points. This is despite the fact that positive developments in US-China trade relations have boosted tech stocks. For example, Nvidia increased by 5.79%, Amazon increased by 1.64%, and IBM increased by 1.87%.
Dow Jones Industrial Average Heat Map | Source: Tipranks
Healthcare stocks thrust on Trump’s new move
Still, profits from Nvidia and Amazon were added to Microsoft’s 0.28% loss and a huge loss from healthcare companies. For example, Johnson & Johnson lost 3.04%, while Merck lost 3.18% of both companies involved in healthcare.
Additionally, UnitedHealth lost an astonishing 16.34% after a sudden departure by longtime CEO Andrew Witty. The company also suspended annual price forecasts, citing rising medical costs for the decision.
You might like it too: Fed Conference Summary: Unchanged Rate, Powell highlights inflation and unemployment risk
Medical stocks have fallen after US President Donald Trump signed an executive order aimed at reducing prescription drug prices. The administration has directed businesses to cut drug prices to a level similar to what patients in other countries pay. For those who don’t follow, the White House is threatening unspecified measures while escalating to line them up.
Analysts estimated that reducing US drug prices could reduce the global pharmaceutical industry’s 2028 net profit by 8%. Still, the move will cut back on healthcare companies’ profits, but it could provide relief for Americans struggling with rising healthcare costs.
You might like it too: Is Bitcoin really an anti-bank wildcard?
