Healthcare Stocks Heat Up — Tuesday’s IP Market Recap

by Marc Bastow | April 2, 2013 5:00 pm

[1]Investors focused on strong news in the healthcare sector as well as the broader economy to pull themselves out of Monday’s doldrums, pushing the Dow Jones Industrial Average and S&P 500 back into record territory.

The Dow rose 0.61% to a new all-time high at 14662.01, while the S&P 500 improved by 0.52% to its own mark of 1570.25. The Nasdaq pulled up the rear, gaining 0.48% to close at 3254.86.

The rally was juiced by news in the healthcare sector, as the The Centers for Medicare and Medicaid Services announced a 3.3% increase in what the government will pay insurance companies that offer Medicare Advantage plans. The CMS’s original reimbursement rate proposal called for a 2.2% cut.

Insurers roared in response, including Humana (NYSE:HUM[2], +5.5%), UnitedHealth Group (NYSE:UNH[3], +4.7%) and Aetna (NYSE:AET[4], +3.7%), and the healthcare sector as a whole pushed forward, as shown in the 1.5% gain for the Health Care SPDR (NYSE:XLV[5]).

British mobile communications company Vodafone (NASDAQ:VOD[6]) rose more than 3% on reports that it could be broken up[7] and sold as part of a three-way deal with AT&T (NYSE:T[8]) and Verizon (NYSE:VZ[9]), which shares joint interest of Verizon Wireless with VOD. VZ and T moved ahead just under 1% on the day.

All three major U.S. automakers reported solid March truck and car sales[10], and Ford (NYSE:F[11]) and General Motors (NYSE:GM[12]) rose just under 1% on the day.

Among the few stocks not joining in the rally was Hewlett-Packard (NYSE:HPQ[13]), which slumped 5% on a Goldman Sachs downgrade to “sell.” Goldman also changed its mind on Apple (NASDAQ:AAPL[14]), cutting its price target from $600 to $575 per share, though it retains its “buy” rating. AAPL still managed to improve fractionally despite the news.

Three Up

• Media General (NYSE:MEG[15]): Up 8.1% (51 cents) to $6.78.
• Molycorp (NYSE:MCP[16]): Up 6.7% (33 cents) to $5.24.
• Garmin (NASDAQ:GRMN[17]): Up 5.1% ($1.65) to $34.25.

Three Down

• Nasdaq OMX Group (NASDAQ:NDAQ[18]): Down 12.8% ($4.10) to $27.91.
• Eldorado Gold (NYSE:EGO[19]): Down 9.4% (88 cents) to $8.50.
• Delta Air Lines (NYSE:DAL[20]): Down 8.1% ($1.31) to $14.94.

Marc Bastow is an Assistant Editor at InvestorPlace.com. As of this writing, he was long AAPL and VZ.

Source URL: https://investorplace.com/2013/04/tuesdays-ip-market-recap-hum-unh-aet-dva-f-gm/

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