The S&P 500 fell 2.4% as President Donald Trump expressed disdain for the Federal Reserve chairman and China warned its trading partners not to engage in confrontational trade.
Shares of Universal Health Services fell after reports that government cost-cutting measures could hit Medicaid profits at hospital chains.
Shares of both credit card issuers rose after regulators said Capital One could proceed with its acquisition of Discover Financial.
Major U.S. stock indexes fell sharply at the start of this week’s trading as President Donald Trump stepped up his condemnation of Federal Reserve Chairman Jerome Powell and China warned of retaliation against countries that sign trade deals with China that are not in its interests.
The S&P 500 plunged 2.4%, the Dow fell 2.5% and the Nasdaq closed down 2.6%.
Shares of Universal Health Services (UHS) plunged 10.2%, the biggest decliner among S&P 500 components. The move comes after the Wall Street Journal reported that Republican officials interested in cutting costs may target Medicaid-related profits at hospital chains. Supplemental Medicaid payments accounted for more than half of Universal Health Services’ pretax income last year, the report said.
Shares of asset management giant Blackstone Group (BX) fell 7.8%. While strong performance in its private equity and credit businesses helped the company beat earnings expectations in its quarterly report on Thursday, Blackstone CEO Stephen Schwarzman said economic uncertainty could affect its asset sales in the short term.
The U.S. Department of Energy is considering a sharp cut of nearly $10 billion in funding for clean energy projects, according to the Wall Street Journal. While funding cuts could affect a variety of energy technologies, nuclear power generators were among those under pressure during Monday’s trading session. Vistra (VST) and Constellation Energy (CEG) fell 7.7% and 6.8%, respectively.
Federal regulators approved Capital One Financial’s (COF) acquisition of Discover Financial Services (DFS) during the market’s recess on Friday. The combined company will become the largest credit card company by outstanding balances. Discover shares rose 3.6% on Monday, the best performance of the S&P 500 index in its first trading day after approval. Capital One shares rose 1.5%.
Shares of Fidelity National Information Services (FIS) rose 2.4% after Citi upgraded the company to “buy” from “neutral” and raised its price target. Analysts highlighted that a deal announced last week by FIS will help it expand its presence in credit card processing, which means the company could cross-sell with banking customers.
Netflix (NFLX) shares rose 1.5% after analysts at several research firms raised their price targets. The video streaming giant beat sales and profit expectations in its quarterly results released Thursday afternoon. During the company’s earnings call, co-CEO Greg Peters noted that Netflix has remained resilient despite tough economic conditions.
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