Stocks Mix It Up: S&P and Nasdaq Climb as Earnings Roll In

The Wall Street Journal, Reuters, Market Watch, and Investor’s Business Daily contributed to this report.

Wall Street woke up a little complicated Tuesday: the S&P 500 and Nasdaq were nudging higher on a fresh wave of corporate earnings, while big health insurers took a gut punch after Washington floated a much-smaller-than-expected Medicare Advantage rate bump.

It wasn’t a one-note rally. Automakers and industrials helped the mood – General Motors jumped after a strong quarter and UPS and FedEx rallied on upbeat revenue outlooks – even as Boeing slipped despite reporting a profit. At the same time, airline names with rough guidance and weather headaches, like American and JetBlue, weighed on pockets of the market. Overall, investors are eyeing a “mega week” of results from the biggest tech names that could keep the momentum going.

But the big drama came from healthcare. Stocks for UnitedHealth, Humana, CVS and other insurers plunged after reports that the administration’s proposal would lift Medicare Advantage payments by only a tiny amount for 2027 – roughly 0.09% – far below last year’s much bigger increase. That news erased a huge chunk of market value in the sector and sent UnitedHealth tumbling about 19% on the day.

The fallout was immediate: the Dow – which has a heavier weighting of insurer and industrial names – lagged, while the tech-heavy Nasdaq and record-chasing S&P kept chugging higher. Traders said the split shows just how selective this rally is: positive corporate news can lift parts of the market even as policy headlines slam specific sectors.

Regulators and industry groups warned the proposed Medicare tweak could force insurers to rethink benefits or pricing for millions of Medicare Advantage enrollees, and lobbyists suggested the number could change before it’s finalized. For investors, though, the takeaway was immediate and brutal: a sharp re-price of insurer stocks that had been trading on much sunnier prospects.

Looking ahead, attention turns to earnings from the “big tech” crowd – Microsoft, Meta, Tesla and others –which could either reinforce the market’s optimism about AI and corporate profits or knock it back if guidance disappoints. Fed watchers are also tuned in for any clues about the central bank’s next move, though most expect interest rates to stay put for now.

Bottom line: it’s earnings season that’s steering the market today, with corporate beats lifting indexes even as a policy shock in healthcare trims chunks off particular groups. Investors will be parsing profit reports and policy updates all week – and the swings are likely to stay lively.