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UnitedHealth was the best-performing stock in the S&P 500 and Dow Tuesday
Credit: PATRICK T. FALLON / AFP / Getty Images

Key Takeaways

• Health insurance stocks jumped Tuesday after the U.S. government said it would raise the amount it pays private insurers to administer Medicare Advantage plans more than expected next year. 
• Health insurance stocks have been under pressure lately, in the face of rising expenses and political frustration with high healthcare costs.

Health insurer stocks are surging after a bigger-than-expected boost to Medicare Advantage payment rates.

The Centers for Medicare and Medicaid Services on Tuesday said the amount it pays private insurers to administer Medicare Advantage plans will increase nearly 2.5%, or about $13 billion, next year. The CMS in January proposed increasing payments by less than 0.1%, or about $700 million. 

UnitedHealth Group (UNH) shares were up over 10% in recent trading, leading gains on the S&P 500 and Dow Jones Industrial Average following the news. Humana (HUM) rose about 9%, while Aetna owner CVS Health (CVS) advanced 6%, and Elevance Health (ELV) climbed 3%.

Why This Matters to Investors

The higher rate represents a major win for health insurance providers, and could mean an additional $13 billion in payments tied to Medicare Advantage plans next year, according to the CMS.

Health insurance stocks have been under pressure for more than a year, in the face of rising expenses and political frustration with high healthcare costs. President Trump entered the White House last year vowing to lower drug prices and rein in pharmacy benefit managers, the middlemen that set those prices. The administration has launched investigations into insurers’ Medicare billing practices, and Congressional Democrats placed the high cost of health insurance at the center of last year’s record-breaking government shutdown. 

Even with Tuesday's gains, shares of UnitedHealth Group, America's largest insurer, have slumped more than 40% over the past 12 months. The stock, once the highest-priced equity in the Dow, has lost roughly half of its value from its 2024 highs.

Humana shares have lost about a fifth of their value since the year began. Elevance has dropped about 11%, while CVS Health stock is down 2% over the same period.

Tech giant Apple recently turned 50 years old.
Credit: Cheng Xin / Getty Images

Key Takeaways

• Shares of Apple fell Tuesday as investors considered the possibility that an upcoming product might be delayed.
• The product is a foldable phone, which according to reports was expected this year but may push back to 2027.

Shares of Apple (AAPL) slumped on Tuesday following reports that its foldable iPhone could be delayed by engineering problems. 

Nikkei Asia on Tuesday reported the consumer tech giant was experiencing setbacks in the test phase of its first foldable iPhone. The difficulties could delay the full-scale production and rollout of the highly anticipated new model. Apple did not respond to Investopedia's request for comment in time for publicaiton.

Apple stock was down about 3% in recent trading. (Read our full daily markets coverage here.) As the S&P 500’s second-largest component with a market value of about $3.6 trillion, Apple weighed on the capitalization-weighted benchmark.

The report has stoked worries that the foldable phone, which was expected to launch later this year, may not come until 2027. Analysts have said they’ll be watching closely for updates on Apple’s progress when it reports earnings later this month, and at the company’s developers conference in June.

Apple, which turned 50 years old earlier this month, has been under pressure in recent years to develop new category-defining products akin to the Macintosh, iPod, and iPhone, which revolutionized the markets for personal computers, MP3 players, and smartphones, respectively. 

A delay of the foldable iPhone could deal another big blow to investor confidence, after a series of delays in highly anticipated AI features. 

Heading into Tuesday, Apple shares were down less than 5% since the start of the year, making it the best-performing stock in the Magnificent Seven in 2026. The stock was buttressed by signs of strong demand for its iPhone 17, released last year, and a diversification of its product offerings. 

Casey's shares have gained 35% since the start of the year
Credit: Casey's General Store

Key Takeaways

• Casey's General Stores is set to become the newest addition to the S&P 500 on Thursday, replacing Hologic after the medtech firm was acquired by Blackstone and TPG.
• The gas station and convenience store operator's stock has surged nearly 80% in the last 12 months as value-seeking consumers have boosted Casey's sales.

Casey's General Stores is set to join the S&P 500 this week, after a torrid rally in recent months.

Casey's (CASY) stock will move from the S&P MidCap 400 to the S&P 500 ahead of the opening bell on Thursday, S&P Dow Jones Indices said Monday. The retailer is replacing Hologic (HOLX), after the medical tech firm agreed to be taken private by Blackstone (BX) and TPG (TPG) in a deal that closed Tuesday.

The move could help Casey's stock, which was little changed Tuesday afternoon on a down day for broader markets, extend its recent rally. The shares have soared 35% since the start of the year, and some 80% in the last 12 months as sales surged and the gas station and convenience store operator consistently beat analyst estimates in recent quarters.

Why This Matters to Investors

Inclusion in a major index can help boost a stock by introducing it to a wider base of investors, and its shares being bought up by funds that track the performance of the index.

The chain has benefitted from Americans' search for value, as many squeezed consumers have turned to lower-cost options like discount retailers and convenience stores for more of their shopping.

Analysts are largely bullish on Casey's. Of the six analysts with current ratings tracked by Visible Alpha, five have recommended buying the stock compared to one neutral rating, though it's already outpaced their mean price target with its recent gains.

Casey's will be replaced by DigitalOcean Holdings (DOCN) in the S&P MidCap 400, and Broadstone Net Lease (BNL) will take DigitalOcean's spot in the S&P SmallCap 600.

Some analysts think U.S. tech stocks look like value opportunities at present.
Credit: Charly Triballeau / AFP via Getty Images

Key Takeaways

• Goldman Sachs says the price-to-earnings growth ratio between the U.S. stock market and the rest of the world has reset. There is a "record gap'" between U.S. tech stock performance and their underlying earnings growth, according to the firm.
• The iShares MSCI ACWI ex US ETF, which holds the world's stocks excluding the U.S.'s, has risen 3% year-to-date, while a fund that holds the Magnificent Seven stocks has declined more than 11% over the same period.

Are tech stocks the new value stocks?

That's what Goldman Sachs analysts explored in a recently published report that examined the sector's relative performance since the start of the year. U.S. technology stocks—particularly the cohort called the Magnificent Seven, referring to Nvidia (NVDA), Microsoft (MSFT), Meta Platforms (META), Alphabet (GOOGL), Amazon (AMZN), Apple (AAPL) and Tesla (TSLA)— have powered broad market indexes higher in the aftermath of the 2008 financial crisis, but have started to lag the rest of the world's stocks.

The iShares MSCI ACWI ex US ETF (ACWX), an exchange-traded fund that holds a range of international and emerging market stocks, has risen 3% year-to-date through Monday. The Roundhill Magnificent Seven ETF (MAGS), which holds the tech majors in equal proportion, has fallen 11% over the same period. That, Goldman suggest, could be a buy signal.

WHY THIS MATTERS TO INVESTORS

Investors have panned the technology sector in search for growth elsewhere in the U.S. stock market. Now Wall Street firms are suggesting that the "opportunity" for future performance and growth lies in that very cohort.

The U.S. equity market at large "no longer looks so expensive" relative to the rest of the world, they wrote, and U.S. tech stocks now look like "valuation opportunities" because of the growing gap between their price performance and their expected earnings growth.

Put another way, the U.S. tech sector has posted the worst performance relative to the rest of the world's stocks excluding tech, since the early 1970s, when U.S. inflation was in the double digits.

A host of factors have weighed on the sector starting with the release of DeepSeek in early 2025, when China's answer to the U.S.'s artificial intelligence started to worry investors about the U.S.'s ability to compete. Hyperscalers' outsize capex spending on AI has raised concerns about that cohort's ability to produce returns on their investments.

"These factors have opened up an opportunity in the technology sector where growth rates remain strong, but valuations are now low," Goldman analysts including Peter Oppenheimer said in a report published Tuesday. They added that there is now a "record gap" between U.S. tech stocks' earnings per share growth and their performance.

Consensus forecasts suggest tech stocks earnings-per-share growth hit 44% for the first quarter of this year, accounting for almost 90% of the S&P 500's overall growth for that period. Meanwhile, Goldman said, the tech sector's debt levels remain low when compared to the rest of the U.S. market.

The war in Iran would also appear to raise the attractiveness of the sector at large, because the impact on macro markets has been to price in higher inflation and interest rates rather than lower growth prospects, Goldman said. The longer the Strait of Hormuz remains effectively closed, the higher the risk of a perceived growth shock.

"Given the relative insensitivity of the cash flows in the technology sector to economic growth, and the benefit it would derive on any rally in bond yields, this sector might prove to be more defensive over the next few months," Goldman's analysts said.

That said, investors tend to be under-allocated to stocks outside of the Magnificent 7, according to Michael Landsberg, chief investment officer of Landsberg Bennett Private Wealth Management. To Landsberg, the tech majors' relative underperformance since the group's peak on Halloween is a sign to look beyond them.

"We know everyone has Mag 7 names," he said in a Tuesday morning interview with CNBC. "The 493 is where you wanna look."

Prices that aren't directly observed by data collection agencies are pushing up inflation.
Credit: Michael Nagle / Bloomberg via Getty Images

Key Takeaways

• "Nonmarket" prices, such as portfolio management fees, have added 0.7 percentage points to PCE inflation over the past two years, keeping it above the Fed's 2% annual target.
• Those fees rise with the value of financial assets, so the stock market boom of recent years has pushed up the price index.
• Ignoring those nonmarket prices might lead the Fed to keep its benchmark interest rate significantly lower, thereby lowering borrowing costs across all kinds of loans.

We all know gas, groceries, and utility bills have been keeping inflation a little too hot for comfort lately. It also turns out the stock market has been providing a sneaky boost to inflation as it's commonly measured.

That's according to an analysis by researchers at the Federal Reserve Bank of San Francisco, who looked at the role of financial markets in the Personal Consumption Expenditures inflation gauge. That benchmark is preferred by Federal Reserve policymakers when evaluating whether inflation is at its 2% annual target.

As of January, PCE inflation increased 2.8% over the year and has been more than 2% since 2021. However, that would likely be much less—possibly leading the Fed to cut its influential interest rate—if not for a quirk of how PCE is measured.

Government statistical agencies like the Bureau of Economic Analysis, which publishes the PCE price index, measure inflation by having agents go out and look at prices for the things people buy, such as clothes, car insurance and plane tickets. Those "market prices" account for most, but not all, of the index.

Some expenses are a bit harder to measure, including portfolio management fees and other financial services. The government "imputes" or estimates these prices. Because portfolio fees are often based on performance, they rise when the stock market goes up.

What This Means For The Economy

If the Fed judged inflation only by prices it could actually measure, the inflation rate would look much lower, possibly leading the central bank to keep interest rates lower and providing a boost to the economy.

These "nonmarket" prices have accounted for an increasing share of PCE inflation in recent years, the Fed researchers found. And with stocks hitting record highs regularly over the past two years, they've contributed a surprising amount to the PCE index, possibly giving an impression that inflation is higher than it really is.

Over the last two years, 0.7 percentage points of annual PCE inflation has been due to financial fees and other nonmarket prices, the San Francisco Fed researchers led by director of economic research Sylvain Leduc found.

If you calculated inflation without those nonmarket prices, it would be much closer to the Fed's 2% annual target. That has implications for how the Fed manages its monetary policy.

In recent months, the Fed has kept the federal funds rate higher for longer, pushing up borrowing costs across all kinds of loans to discourage spending and stifle inflation. Under one common inflation-targeting framework, the Taylor Rule, the Fed would be expected to have its key interest rate 0.4 percentage points lower than it is now if it ignored nonmarket prices, the San Francisco Fed researchers found.

"Because imputing prices that cannot be directly observed introduces uncertainty in inflation measures, one approach to monetary policy would be to focus on prices that are directly observed," they wrote. "Under a well-known monetary policy rule, such an approach suggests a notably lower federal funds rate. However, approaches that implicitly account for the uncertainty that policymakers face would leave the federal funds rate essentially unchanged."

Even with Tuesday's gains, Broadcom shares are still down about 6% since the start of the year
Credit: Jonathan Raa / NurPhoto / Getty Images

Key Takeaways

• Broadcom shares climbed Tuesday after the chipmaker announced a pair of agreements to provide custom chips to Google and computing capacity to Anthropic.
• Broadcom and other semiconductor stocks have had a rough start to the year amid uncertainty around the sustainability of financing in the sector.

Broadcom shares surged Tuesday after announcing new deals with Google and Anthropic. Can it help revive some struggling corners of the AI trade?

Shares of Broadcom (AVGO) were up 3% in recent trading, after the AI chipmaker said Monday that it will produce more custom chips for Alphabet's (GOOGL) Google, and support additional computing capacity for Anthropic. Financial details of the deals were not disclosed.

With Tuesday's gains, Broadcom shares recovered some of their recent losses, but remain about 6% lower for the year. Broadcom and many of its AI chipmaking peers have been pressured amid some concerns about the trajectory of the technology and the sustainability of financing in the sector.

Why This Matters to Investors

New deals with Anthropic and Google could help boost investor confidence in Broadcom's ability to hit the lofty targets it laid out in recent earnings reports.

Shares of AI chip leader Nvidia (NVDA) and rival Advanced Micro Devices (AMD), which were down about 1% in recent trading as markets fell broadly, have spent much of the year so far in negative territory despite strong results. A boost yesterday and late last week on the heels of analyst upgrades helped pull AMD back into the green for 2026, though Nvidia shares remain down about 6% year-to-date.

Broadcom's latest deals could help ease some of the concerns that have weighed on its shares and those of rivals. Jefferies analysts said they view Broadcom's latest agreement with Google as a "strong endorsement" of its positioning that could boost confidence in the company's ability to hit the analysts' growth targets.

News of the day for April 7, 2026

The major indexes started off the week with slight gains.
Credit: Michael M. Santiago / Getty Images

Stocks are pointing lower Tuesday morning. Investors remain cautious ahead of President Donald Trump's latest deadline for Iran, which comes tonight, when the U.S. could attack power plants and bridges if the Strait of Hormuz isn't opened; Health-insurance stocks are surging after the Centers for Medicare and Medicaid Services finalized a better-than-feared planned payment rate increase for 2027; Levi Strauss is among the first big companies set to post earnings with its results due after the closing bell, followed by Delta Air Lines tomorrow; SpaceX is reportedly looking to host events with investors and analysts ahead of a potential June IPO that could value the company as high as $2 trillion.

Here's what you need to know today.

Stocks, Oil Sink Ahead of Latest Iran Deadline

Stock futures are falling ahead of Tuesday's open as markets await updates on the war in Iran ahead of Trump's Tuesday night deadline for the Strait of Hormuz to be reopened. Dow Jones Industrial Average and S&P 500 futures were each down 0.4% recently, while futures tied to the tech-heavy Nasdaq 100 slid 0.6%. The major indexes gained to open the week after Trump during a press conference said Iran was participating in ceasefire talks. Crude oil futures are up 2% to $114.50 a barrel after gaining Monday, while gold futures are hovering just below $4,700 an ounce. The 10-year Treasury yield is little changed from yesterday's close of 4.34%. Bitcoin is trading just above $68,000 after briefly surpassing the $70,000 mark yesterday.

Trump's Stated Deadline For Strait of Hormuz Reopening is Tonight

Trump over the weekend set a deadline of Tuesday night for the Strait of Hormuz to be reopened, threatening to attack Iran's power plants and bridges if it is not done. Iran on Monday reportedly rejected a proposal from Pakistan and other countries mediating the conflict that would have included a 45-day ceasefire and the reopening of the Strait, as Iran said it will only accept a deal that ends the conflict permanently. Iran's Revolutionary Guard early Tuesday said it would deprive the U.S. and its allies of oil and gas from the region for "years" if Trump follows through with his threat, The Associated Press reported, also threatening its fellow Gulf nations with expanded retaliatory attacks if they continue to assist the U.S.

CMS Medicare Proposal Lifts Health Insurance Stocks

Health-insurance stocks are rising. The Centers for Medicare and Medicaid Services published its finalized policies for 2027 Medicare Advantage payment plans after the closing bell Monday, news that included an average increase of 2.48% paid to Medicare insurers next year, amounting to an extra $13 billion. The news sent health insurers like UnitedHealth Group (UNH), Humana (HUM), and Aetna parent CVS Health (CVS) surging, with the stocks up 6% to 10% premarket. A lower-than-expected proposed increase of 0.09% dragged the sector lower earlier this year, with UnitedHealth stock sinking nearly 20% in one session.

Earnings Season is Here With Levi Strauss Today, Delta Tomorrow

First-quarter earnings season has arrived: Levi Strauss & Co. (LEVI) is set to report after today's closing bell followed by Delta Air Lines (DAL) and Constellation Brands (STZ) tomorrow. Results from the big banks are slated to start next week. Of the 110 companies in the S&P 500 that have recently provided earnings per share forecasts for the first quarter, 59 have been positive, the highest number for a single quarter since the second quarter of 2021, FactSet wrote Monday. The outlook for many industries is cloudier over the rest of the year, with investors watching earnings from airlines and other fuel-heavy businesses closely for insights on how the Iran war could impact the economy. Analysts broadly expect double-digit earnings growth in Q1.

SpaceX Targeting June IPO; Valuation Could Hit $2 Trillion

SpaceX is officially on the road to going public after the space, AI, and social media company filed confidentially last week. Company officials are meeting with banks that could be involved in the IPO, telling them the company plans to host events for analysts and thousands of investors in June to sell itself ahead of the debt, according to Reuters. The company's valuation could end up as high as $2 trillion, Bloomberg reported, a number that could see SpaceX raise up to $75 billion through the IPO and put it above Meta Platforms (META) and SpaceX CEO Elon Musk's own Tesla (TSLA) among the most valuable public U.S. companies.

Buffett also revealed last week that he continues to help steer Berkshire Hathaway's investment choices since retiring as the company's CEO.
Credit: Andrew Harrer / Bloomberg / Getty Images

Key Takeaways

• Buffett argued that even the Fed's 2% inflation target erodes savings over time, especially for people who pay taxes on gains from interest.
• Most economists say targeting zero inflation risks deflation, higher unemployment, and strips the Fed of its most important recession-fighting tool: the ability to cut interest rates.

Warren Buffett thinks the Federal Reserve is too comfortable with rising prices, even if it reaches its stated goal of limiting inflation to 2% a year.

At 2% annual inflation, a dollar loses almost half its purchasing power over 30 years. Buffett, the legendary investor who recently handed over the reins at conglomerate Berkshire Hathaway, is at odds with central bankers and most economists, who say that permanently lowering inflation to below 2% would do more harm than good.

"I wish they had a zero inflation target," Buffett told CNBC on March 31 in his first extended interview since stepping down as Berkshire's (BRK.A, BRK.B) CEO. "Once you start saying you're going to tolerate 2%, that compounds pretty dramatically over time."

Note

The 2% inflation target traces back to an offhand remark by a New Zealand finance minister in a 1989 TV interview. It was adopted by Canada, the U.K., and the Fed.

The Saver's Complaint

Buffett framed inflation as a tax that hits savers the hardest. "You're saying to people, if you're getting less than 2% on your money, you're going backward," he said. "And actually, if you pay tax, you may pay tax on the 2%."

If you earn 2% interest and pay a 24% marginal tax rate, your after-tax return drops to 1.52%, below the Fed's inflation target of 2%.

Buffett isn't alone in critiquing the 2% target. Paul Volcker, whom Buffett named as one of his "heroes at the Fed," preferred keeping inflation below 1%.

Why the Fed Sees Some Inflation As Necessary

Getting inflation to zero would require keeping rates high enough to choke off even small price increases—at the cost of slower growth and, likely, higher unemployment. The 2% target, formalized by the Fed in 2012, exists because it decided that the cost wasn't worth it.

For one thing, the Fed wants flexibility. When inflation is at 2%, the benchmark rate typically sits around 4% to 5%, giving the Fed room to cut in a downturn. With near-zero inflation, that cushion shrinks, a problem the Fed ran into after the 2008 financial crisis, when it cut to near zero and unemployment still topped 9%. It had to turn to quantitative easing—buying trillions in bonds—to stimulate growth.

Inflation also lets employers adjust labor costs without cutting pay outright—your salary stays flat, but you can buy slightly less. At zero inflation, the only option is layoffs. Researchers at Brookings argue this means lower inflation could permanently raise unemployment by 1 to 3 percentage points.

At zero inflation, cash doesn't lose value to inflation, so the incentive to spend and invest weakens. Japan's "lost decade" of the 1990s is the cautionary tale for economists: Japan's economy, despite better growth since, has never been the same.

For now, with the Iran war threatening an oil shock and tariffs adding on to prices, the Fed's challenge is getting to 2%, let alone zero.

Delta shares are down about 4% since the start of the year
Credit: Tayfun Coskun / Anadolu / Getty Images

Key Takeaways

• Delta's quarterly earnings are due Wednesday morning, with the stock seen moving up to 7% by the end of the week.
• Delta and other airline stocks have been pressured in recent weeks amid concerns about how the Iran war could impact fuel prices.

Delta Air Lines is scheduled to report earnings ahead of the opening bell Wednesday, with traders anticipating a big move from the carrier's stock following the results.

Based on current options pricing, Delta (DAL) stock is seen swinging up to about 7% in either direction by the end of the week. A move of that size from Monday's close could lift the stock above $71, recovering its losses to start the year. The low end of that range could drag the stock below $63.

Delta and other airline stocks have endured a volatile stretch recently as the war in Iran sent fuel prices surging. Delta shares are down about 4% since the start of the year.

Why This Matters to Investors

Investors and analysts will likely be looking to Delta's earnings and outlook for signals about the broader industry. Alaska Airlines, United Airlines, and Southwest Airlines are set to follow with their results later this month.

UBS analysts on Sunday wrote that they could see Delta providing a wider outlook range, or even suspending its full-year forecasts considering uncertainty around fuel prices.

Delta is expected to report adjusted earnings per share of 59 cents on a 7% year-over-year rise in revenue to $15.08 billion for the first quarter, according to analyst estimates compiled by Visible Alpha.

Analysts are overwhelmingly bullish on Delta, with all nine analysts with current ratings tracked by Visible Alpha recommending buying the shares. Their average price target of $81 would suggest upside of about 21% from Monday's close.

With Monday's gains, Seagate Technology shares have surged 65% since the start of the year
Credit: Chris Jung / NurPhoto / Getty Images

Key Takeaways

• Seagate Technology shares rallied to a record high Monday as Morgan Stanley analysts named the stock their "top pick" in IT hardware.
• A global shortage of storage and memory components that has driven up prices in the sector could last until 2028, the analysts wrote.
• Shares of Seagate rival Western Digital and Micron Technology also climbed.

Seagate Technology's stock is surging to fresh highs. One group of analysts thinks the rally can keep rolling.

Shares of Seagate (STX) jumped nearly 6% Monday to close at a record high just above $453, as analysts from Morgan Stanley named the hard drive maker their "top pick" in IT hardware. Other data storage and memory stocks, including Western Digital (WDC), Micron Technology (MU), and Sandisk (SNDK), climbed along with it to rank among the biggest gainers in the S&P 500 Monday.

The analysts said they chose Seagate over rival Western Digital (WDC) as their top pick, given expectations it could have more room to rise and boost margins faster. However, both stocks are seen benefiting from a global shortage of storage and memory components that could last until 2028, the analysts wrote in a Monday note.

Why This Matters to Investors

Many investors may be wondering how much longer memory and hard drive stocks can keep climbing. Morgan Stanley is suggesting that the boom in AI demand and shortage of components underpinning their gains could last years.

Investors "continue to under-appreciate the fundamental strength" the shortage is creating for makers of hard drives like Seagate and Western Digital, the analysts said.

Morgan Stanley lifted its price target for Seagate to a new Street high of $582 from $468, and to $380 from $369 for Western Digital. That would suggest the analysts see the stocks rising roughly 28% and 25%, respectively, from Monday's levels.

Memory stocks have been rallying for much of the last year as investors have flocked to "pick-and-shovel" companies behind the hardware used to power big tech companies' AI data centers.

With Monday's gains, Seagate's stock is up 65% since the start of the year. Sandisk has more than tripled in value over the same period, while Western Digital's stock soared about 77%, and Micron added 32%, at a time when the broader S&P 500 lost 3%.

This article has been updated since it was first published to reflect more recent prices.