The S&P 500 experienced a decline of 0.4% on May 20, signaling the end of a six-day winning streak as investor confidence in trade and inflation began to falter. This drop raised concerns about the durability of the recent market rally, largely driven by improved trade relationships and optimism concerning potential tariff reprieves.
All major U.S. equity indexes reflected this downward trend, with the Nasdaq also closing 0.4% lower and the Dow decreasing by 0.3%. A significant contributor to the decline was the sharp plunge in shares of Fair Isaac Corporation (FICO), which plummeted 8.1% after comments made by Bill Pulte from the Federal Housing Finance Agency regarding concerns over FICO’s pricing practices.
In contrast, shares of Moderna surged by 6.1%, marking the most significant increase in the S&P 500 following new guidance from the FDA on COVID-19 vaccine boosters. Although the agency requires additional clinical data for vaccines targeting healthy individuals under 65, it has reaffirmed its approval for older and higher-risk populations, maintaining the company’s key market position.
AES Corporation saw its shares fall 4.1% after Jefferies downgraded its stock to “underperform,” citing elevated valuations and an uncertain outlook in the renewable energy sector. Meanwhile, Norwegian Cruise Line Holdings faced a 3.9% dip as analysts from Truist adjusted their price target due to declining consumer confidence impacting cruise demand.
In positive news, discount retailers Dollar Tree and Dollar General rose 4.6% and 4.1%, respectively, as they may benefit from shifting consumer behavior amidst anticipated price increases due to elevated tariffs. Regeneron Pharmaceuticals also made headlines with a 3.2% rise in its stock after acquiring 23andMe, promising to prioritize ethical use and security of customer data.
Incyte saw a 2.3% increase following FDA approvals related to its immunotherapy treatment for anal cancer, showing resilience and supporting investor interest in biotechnology stocks during a volatile market.
Overall, while certain sectors faced headwinds, others such as biotechnology and discount retail emerged as bright spots, indicating opportunities amidst the broader market fluctuations.