Winners and Losers: Energy Stocks Soared and Healthcare Crashed in May
May was a month to remember for the U.S. stock market as the benchmark S&P 500 index posted a gain of 6% and had its best showing since 1990. But, as always, there were winners and losers among equities.
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The big winners among U.S. stocks during May were energy and technology stocks that are helping to power the artificial intelligence (AI) revolution. Specifically, NRG Energy (NRG) saw its share price rise 42% in the month and Constellation Energy (CEG) was close behind with a 37% gain. Both companies power AI data centers through cleaner energy sources such as natural gas.
Other big winners in May were previously downtrodden technology stocks that are also associated with AI. These include data storage firm Seagate Technology (STX), whose share price increased 37% and outpaced AI chipmaker Nvidia (NVDA). Super Micro Computer (SMCI), which makes AI servers that run Nvidia microchips, also had a big month, with its stock running 26% higher.
Healthcare Loses Out
On the flipside, healthcare was the worst-performing sector of the market in May. The declines were led by insurer UnitedHealth Group (UNH), whose share price fell 27% amid worries after the company slashed its full-year guidance. Also dragging healthcare lower was pharmaceutical giant Eli Lilly (LLY), whose stock dropped 18% after the Trump administration said it wants prescription drug prices lower.
Other healthcare stocks that took a drubbing in May include retail pharmacy chain CVS Health (CVS), and healthcare insurer Humana (HUM). The lone bright spot among healthcare stocks was Insulet (PODD), whose share price vaulted 29% higher on strong financial results. The stock has been on an upswing since the U.S. Food and Drug Administration (FDA) approved its insulin system for Type 2 Diabetes last summer.
Is LLY Stock a Buy?
The stock of Eli Lilly has a consensus Strong Buy recommendation among 18 Wall Street analysts. That rating is based on 16 Buy, one Hold, and one Sell recommendations issued in the last 12 months. The average LLY price target of $1,003.14 implies 34.82% upside from current levels.
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San Francisco Chronicle
32 minutes ago
- San Francisco Chronicle
The UK seeks to send a message to Moscow as it outlines higher defense spending
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32 minutes ago
Can Trump fix the national debt? Republican senators, many investors and even Elon Musk have doubts
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Tech billionaire Musk, who was until recently part of Trump's inner sanctum as the leader of the Department of Government Efficiency, told CBS News: 'I was disappointed to see the massive spending bill, frankly, which increases the budget deficit, not just decreases it, and undermines the work that the DOGE team is doing." The tax and spending cuts that passed the House last month would add more than $5 trillion to the national debt in the coming decade if all of them are allowed to continue, according to the Committee for a Responsible Financial Budget, a fiscal watchdog group. To make the bill's price tag appear lower, various parts of the legislation are set to expire. This same tactic was used with Trump's 2017 tax cuts and it set up this year's dilemma, in which many of the tax cuts in that earlier package will sunset next year unless Congress renews them. But the debt is a much bigger problem now than it was eight years ago. 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San Francisco Chronicle
an hour ago
- San Francisco Chronicle
Feds' abrupt cutoff of HIV prevention funds threatens decades of progress, S.F. providers say
Leaders in HIV care in San Francisco and across the country say their critical efforts to stop new infections are under attack by a Trump administration that already has cut several key federal programs and now appears to be withholding money meant to go specifically toward prevention. The bulk of HIV prevention work is supported by federal money, including grants issued through the Centers for Disease Control and Prevention. But the CDC's HIV programs have been gutted this year, and millions in grant money that should have been in the hands of state and local health care providers by now has yet to arrive. In parts of California, including Los Angeles, some prevention programs already have been impacted because the money hasn't come through. Los Angeles County sent notices to dozens of organizations it works with that their contracts would be terminated if federal funds weren't available by June 1. San Francisco may be less immediately impacted because it does not rely on outside contractors for services, and local leaders have promised to backfill any missing federal money. The Los Angeles and San Francisco grants are for about $19 million and $7 million, respectively, and the state gets a separate allotment. But the situation is grim, said experts in HIV care, who worry that any efforts to dismantle public health and services for vulnerable communities will have disastrous effects, and could undo decades of work to slow down and eventually end the AIDS epidemic. 'We have an incredible, effective, world-class HIV prevention and care system, and we can't afford to go back because of what's happening at the federal level,' said Jonathan Frochtzwajg, director of health justice policy for the San Francisco AIDS Foundation. 'This level of uncertainty and instability is unprecedented,' Frochtzwajg said. 'In the past, funding levels may increase or decrease and we would always be in the fight. But with this administration, it's the wholesale elimination of funding streams and programs.' In San Francisco, the federal funding supports HIV prevention efforts along with programs to end other sexually transmitted diseases and hepatitis C, which are often concurrent infections. Losing that money would jeopardize the city's work toward ending the epidemic, said the San Francisco Department of Public Health, and 'significantly weaken' efforts to provide testing, offer uncomplicated access to care for those who test positive, monitor case rates and provide education and outreach. The public health department said Friday that it had not yet received the grant money, which was supposed to arrive by Sunday. HIV care leaders said they were caught off guard by President Donald Trump's attacks on their work since he took office in January. In his previous administration, the president had been supportive of efforts to end the epidemic, and had not touched federal funding. Now, those leaders say, they fear their programs have been swept up in larger plans to scale back federal government and in particular get rid of diversity, equity and inclusion programs. The CDC has especially come under attack in the second Trump administration, and several programs aimed at HIV — including the CDC's HIV research arm — have been scaled back or killed entirely. Trump also has divested from or severely curtailed involvement in programs to support HIV care internationally. HIV care requires intense public health work to control spread of disease, and efforts often are focused on vulnerable communities including people of color and transgender people, who are at much higher risk of infection than other groups. 'That's what they seem to be objecting to: 'Oh, you work with transgender people? You work with gay people? You work with Black people? '' said Carl Schmid, executive director of the HIV+Hepatitis Policy Institute in Washington. 'We don't have the luxury of not thinking about those things,' Schmid said. 'In fact, if you want to utilize tax dollars, that's where the (HIV) cases are. That's what I call being efficient.' Ending the epidemic must include widespread, easy access to testing and prevention tools like PrEP (pre-exposure prophylaxis), say HIV experts. And those who are infected must be treated in order to keep them from passing the infection to others. Indeed, the nation's prevention programs have had a profound effect on slowing down the epidemic, which at its peak in the late 1980s and early '90s was seeing 130,000 new infections a year; that's down to about 30,000 now. In San Francisco, cases dropped from about 2,000 a year during the worst times to about 145 last year. 'Accessible HIV testing, accessible PrEP, accessible care for people living with HIV — all of that is what is driving down our new diagnoses,' said Frochtzwajg. 'We'll see that trend reverse if you take away those services.' Schmid said the timing of the federal cuts was especially frustrating because new prevention tools that will soon become available — including PrEP that may require only one injection a year to be effective — require stable foundations to get the care to people who need it. 'It's really sad, because we have such great hope on the horizon,' Schmid said. 'We have the science, and we're losing the infrastructure.' Lance Toma, chief executive of San Francisco Community Health Center, said he was concerned about the fate of organizations that reach the most vulnerable communities because they tend to be smaller and less resourced. At an event at the Commonwealth Club of San Francisco on May 21, Toma and others painted a dire outlook for HIV care, even as they said they intended to fight for resources. 'We're really headed toward a potential future where we will see the dismantling of organizations that we hold dear,' Toma said. 'Everything we've worked so hard at, the efforts we've made to make competent trans programs, or gay men of color programs — that's where I get scared. These are the folks we've worked so hard for, and these are the folks being targeted.' The Commonwealth Club event called up two panels, one focused on young activists and the other on the current climate. Several participants said they must now look to past activism — in particular, the efforts of ACT UP, a grassroots organization fighting for people with HIV and AIDS — as they pick up the battle all over again. 'We all lived through it, when it was so grim that we didn't really see any light at the end of the tunnel,' said Cecilia Chung, senior advisor with the Transgender Law Center in Oakland who is transgender and HIV positive herself. 'We persevered, we fought and we pushed through. And that's phenomenal.'
