What’s News in Markets: Trade Truce Winners, UnitedHealth Slides, Foot Locker Deal Bounce
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What news sparked a trade deal between the U.S. and China?
Hey, listeners, it's Saturday, May 17th. I'm Francesca Fontana for The Wall Street Journal, and this is What's News in Markets, our look at the biggest stock moves of the week and the news that drove them. Let's get to it. We have a deal. In case you missed it, we got a surprise on Monday when the U.S.
How did the trade deal impact the stock market?
and China announced a trade deal rolling back most of the tariffs between the two countries that have been weighing heavily on investors' minds and on many companies' operations. Now, the relief could be temporary. It's a 90-day agreement, so plenty of uncertainty remains. But the trade optimism sparked a rally on Monday, with the three major indexes making some smaller, mixed moves the rest of the week. On Tuesday, for instance, UnitedHealth's giant drop dragged the Dow lower, and we'll get to that stock's meltdown in a bit. All in all, the three major indexes each made some gains this week. The Dow added more than 3%, the S&P 500 gained more than 5%, and the Nasdaq rose more than 7%. As far as individual movers go, let's run through some of the big winners of the US-China truce. Many of the stocks that had the most to gain were, logically, the ones most exposed to China in their supply chains. So, for example, Amazon, along with other big tech stocks, got a boost from the news.
Which companies benefited from the trade truce?
Amazon's ubiquitous online retail platform and many of the third-party sellers on that platform sourced their products from China. Before the trade deal eased the tariffs that they're subject to, many of these merchants warned that prices could skyrocket, and some said that they would have to stop their operations entirely.
What was the impact of UnitedHealth's stock drop?
So, we saw Amazon shares surge roughly 8% on Monday, and on the week the stock gained 6.5%. Then there was Boeing, which rose on the news that China was scrapping an earlier ban on Boeing's airplanes.
How did Amazon's stock perform after the trade news?
The government last month told Chinese carriers that they had to seek additional approval before taking delivery of Boeing aircraft that they had already ordered, so in effect halting deliveries to one of Boeing's biggest markets. Plus, later in the week, the White House announced that Qatar Airways would buy up to 210 Boeing aircraft, one of several business deals that the president noted during his trip to the Middle East. Boeing shares gained 2.5 percent on Tuesday and rose 5.6 percent on the week. And then there was Nike, which relies on Vietnam, Indonesia, and China for its products and was hit hard last month when the tariffs were announced. It climbed 7.3% on Monday and notched a weekly gain of more than 8%. Now, back to UnitedHealth, the healthcare conglomerate and parent of insurance provider UnitedHealthcare. It's had a rough year, and it had a bad week this week.
On Tuesday, UnitedHealth suspended its 2025 earnings outlook and announced the sudden resignation of Chief Executive Andrew Witte, and the stock dropped a whopping 18%. But that wasn't all. The Wall Street Journal reported that the Justice Department is investigating the company for possible criminal Medicare fraud. And that's along with the other government probes into UnitedHealth, including antitrust investigations and a civil investigation of its Medicare billing practices that the journal first reported in February. UnitedHealth said it hadn't been notified by the Justice Department of the Criminal Investigation, and it stands by the integrity of its Medicare Advantage program.
86. 86%. That is how much that shares of sneaker seller Foot Locker gained on Thursday, thanks to Dick's Sporting Goods, the big box retailer, buying the company for roughly $2.4 billion. If you'll pardon the pun, Foot Locker has been on pretty shaky footing, and its shares have slumped this year on Trump's tariffs. So Foot Locker jumped 86% on Thursday and ended the week with a gain of 98%.
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Chapters
5 chapters
1
What news sparked a trade deal between the U.S. and China?
0:32–0:51
2
How did the trade deal impact the stock market?
0:51–1:58
3
Which companies benefited from the trade truce?
1:58–2:15
4
What was the impact of UnitedHealth's stock drop?
2:15–2:29
5
How did Amazon's stock perform after the trade news?
2:29–6:00
Speakers
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