Stocks were mixed to start the first full trading week of 2025. While the Dow Jones Industrial Average outperformed on strength in UnitedHealth Group (UNH) shares, the Nasdaq Composite fell as tech stocks continued to decline.
At the close, the Dow was up 0.9% to 42,297 as UnitedHealth surged 3.9% after a release from the Centers for Medicare & Medicaid Services (CMS) suggested Medicare Advantage payments could potentially increase by more than 4% next year.
At roughly $545 a share, UnitedHealth has the greatest influence on the price-weighted Dow.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Johnson & Johnson (JNJ) was also one of the top-performing Dow Jones stocks today, adding 1.7%, on news the pharmaceutical giant is buying neuroscience specialist Intra-Cellular Therapies (ITCI, +34.1%) for $14.6 billion in cash.
Jeff Jonas, portfolio manager at Gabelli Funds, is cautious on the deal, mostly due to antitrust concerns. "JNJ has a late-stage Depression drug and has always been a leader in Schizophrenia," he wrote in emailed commentary. "Yes, it's a different mechanism of action but still a lot of overlap. Their timing to close the deal of 'later this year' seems to incorporate a tough review, even under the new administration."
Nvidia drops on updated AI chip rules
The S&P 500 managed to add 0.2% to end at 5,836, while the Nasdaq slumped 0.4% to 19,088 on continued weakness in the tech sector.
Nvidia (NVDA) was one of the more notable decliners, sliding 2.0% after the Biden administration released new rules on how artificial intelligence (AI) chips and models can be shared with other countries, including issuing caps on the number of AI chips that can be exported to specific nations.
U.S. allies such as Britain and Canada are not subject to the restrictions while countries such as China and Russia will continue to face full bans on AI chip purchases.
In a statement, Nvidia said the new rules are a "sweeping overreach" that threaten "to derail innovation and economic growth worldwide."
Palantir keeps sliding
Palantir Technologies (PLTR), an AI software company, also sold off today, ending the session down 3.4%. PLTR was one of the hottest stocks of 2024 – more than quadrupling in value – but has shed 14% so far in 2025.
Morgan Stanley analyst Sanjit Singh recently initiated coverage on the tech stock with an Underweight (Sell) rating and a $60 price target, nearly 7% below where shares are currently trading.
"In the past 18 months or so, Palantir has driven better-than-expected U.S. commercial traction, U.S. government deal momentum, and operating expense discipline," Singh wrote in a January 6 note. This is now well-reflected in the share price, he adds.
Singh admits that the incoming Trump administration could create tailwinds for PLTR, but for now, the stock is "trading too far ahead of the company's intrinsic value to justify a rating upgrade."
Inflation data could spark more volatility
"The recent weakness in equity and bond markets, despite an encouraging payroll report, underscores a heightened sensitivity to inflation expectations and a prevailing pessimistic sentiment," says Mark Hackett, chief market strategist at Nationwide.
This "heightened sensitivity" could create more volatility for stocks following the release of key inflation data this week. Specifically, the December Producer Price Index (PPI) is set for release ahead of Tuesday's open and the December Consumer Price Index (CPI) is due out Wednesday morning.
Bank earnings will also start to roll in on Wednesday, with JPMorgan Chase (JPM) and Goldman Sachs (GS) among those reporting. You can follow all our earnings coverage on Kiplinger's earnings season live blog.
Related content
- Kiplinger's Economic Calendar for This Week
- Earnings Calendar and Analysis for This Week
- When Is the Next Jobs Report?
-
ESPN to Acquire NFL Network and RedZone in Exchange for 10% Equity StakeESPN will take control of NFL Network and RedZone, while the NFL secures a 10% stake in ESPN — a move that could change how fans watch football.
-
Stocks Rally on Apple Strength: Stock Market TodayThe iPhone maker will boost its U.S. investment by $100 billion, which sent the Dow Jones stock soaring.
-
Stocks Rally on Apple Strength: Stock Market Today
The iPhone maker will boost its U.S. investment by $100 billion, which sent the Dow Jones stock soaring.
-
What to Know About Multisector ETFsMultisector bond funds allow investors to pick and choose among a wide array of assets.
-
I'm an Estate Planning Attorney: These Are the Two Legal Documents Everyone Should HaveEvery adult should have a health care proxy and power of attorney — they save loved ones time, money and stress if a sudden illness or injury leaves you incapacitated.
-
I'm a Financial Professional: Here's My Investing Playbook for Political UncertaintyFor successful long-term investing in a politically charged environment, investors should focus on economic data, have a diversified portfolio and resist reacting to daily headlines.
-
Rally Pauses for Hot Earnings, Cool Data: Stock Market TodayMarkets were mostly mixed Tuesday after decisive moves Friday and Monday.
-
The Truth About the Dark Side of Rooftop Solar PanelsRampant bankruptcies in the solar panel industry have left many consumers with systems that don't work and no way to get them fixed. Worse, they're being hounded to keep paying despite not receiving what they were promised. What can they do?
-
Six Big Beautiful Opportunities: Advisers' Guide to Tax and Client StrategiesHere are several ways financial professionals can help their clients maximize opportunities in the One Big Beautiful Bill Act, which extends key TCJA provisions, introduces increased deductions for people 65 and older and more.
-
Dow Rises 585 Points on Rate Cut Hope: Stock Market TodayStocks moved more than 1% again Monday, this time to the upside following the Jobs Friday sell-off.
