U.S. stocks finished sharply divided on Thursday as investors dumped semiconductor names following a disappointing earnings report from Broadcom and piled into health care, financials, and other non-tech sectors. The Dow Jones Industrial Average surged to a fresh all-time high, while the Nasdaq Composite slipped as the rotation away from artificial intelligence trades picked up steam.
What Moved Markets
The Dow jumped 874.86 points, or 1.73%, to close at a record 51,561.93. The S&P 500 gained 30.63 points, or 0.41%, to settle at 7,584.31. The Nasdaq Composite edged lower by 23.02 points, or 0.09%, finishing at 26,830.96.
The split session was driven by two forces pulling in opposite directions. On one side, Broadcom’s fiscal second-quarter results landed just short of analyst expectations, triggering a broad sell-off in chip stocks and dragging on the tech-heavy Nasdaq. On the other, a wave of bullish analyst notes on managed-care companies sent health insurers sharply higher, lifting the Dow and giving the S&P 500 enough of a boost to finish in the green.
Sector performance underscored the rotation. Health care led all S&P 500 sectors with a 3.16% gain, followed by financials at 2.68% and real estate at 2.13%. Technology was the worst performer, falling 1.60%.
Notable Movers
Broadcom (AVGO) tumbled roughly 15% after reporting fiscal Q2 revenue of $22.19 billion, just below the $22.27 billion consensus estimate. Despite guiding Q3 revenue to $29.4 billion and projecting AI semiconductor revenue growth of over 200% year-over-year, the slight miss was enough to spark profit-taking across the chip sector after months of gains.
UnitedHealth (UNH) surged 5.2% to $397 after Bank of America upgraded the stock to Buy and raised its price target to $450, citing softer medical cost trends and AI-driven efficiency gains across managed care. Morgan Stanley also lifted its target to $453. Peers Humana and Cigna rose 6% and 4%, respectively.
Lululemon (LULU) came under pressure after reporting Q1 results that showed gross margins falling 410 basis points to 54.2%. The company also trimmed its full-year outlook, extending a rough stretch — the stock is now down more than 39% year-to-date.
Quantinuum (QNT) made its public market debut, opening at $68 per share after pricing its upsized IPO at $60. The quantum computing company raised $1.68 billion and finished its first day of trading near its opening price, giving it a market value of roughly $15.7 billion.
Looking Ahead
Friday brings the May jobs report, which will be closely watched for signs of labor market cooling. A softer reading could reinforce expectations for a Federal Reserve rate cut later this summer, while a hot number might give policymakers reason to hold. Investors will also be digesting any lingering fallout from the Broadcom-driven chip sell-off and watching whether the rotation into value and defensive names has staying power heading into the weekend.