Wall Street mixed amid trade tensions and corporate woes

[UNITED STATES] Wall Street stocks finished mixed on Thursday, with Cisco Systems posting gains following a positive earnings forecast, while UnitedHealth dropped sharply after reports emerged of a criminal investigation into the insurer.

The S&P 500 has largely rebounded from a steep selloff in April, which was triggered by President Donald Trump's global trade war. Investors are optimistic that the U.S. government will broker agreements to roll back hefty tariffs, which economists have warned could drive up consumer prices.

"People are anticipating deals, so they're positioning ahead of that. They don't want to be short stocks. I’d call it 'deal anticipation,'" said Dennis Dick, a trader at Triple D Trading.

The ongoing trade conflict has significantly impacted market sentiment, with investors keenly watching the developments in U.S.-China trade talks. While some progress has been noted in negotiations, uncertainty over the eventual outcome continues to cloud investor confidence. Analysts suggest that any major breakthrough in the trade discussions could spark a substantial market rally, providing companies and investors with clearer insights into future economic conditions.

Cisco Systems surged nearly 5% after the networking company raised its annual forecast, benefiting from the surge in artificial intelligence demand.

Meanwhile, UnitedHealth Group plummeted 11%, reaching a five-year low, after the Wall Street Journal reported that the U.S. Department of Justice was investigating the company for potential Medicare fraud. UnitedHealth, however, stated that it had not been notified of any criminal inquiry by federal prosecutors.

The healthcare sector is facing increasing regulatory scrutiny, with more frequent investigations and actions against companies. This has raised concerns among investors about the legal and financial risks facing healthcare firms, especially in areas like Medicare and Medicaid, where compliance issues are of paramount importance. UnitedHealth's investigation underscores the broader challenges in the industry.

Walmart fell 0.5% after the retail giant warned that it would raise prices later this month due to tariffs, despite surpassing expectations in its first-quarter U.S. comparable sales. Rival Amazon, which is also heavily exposed to Trump's tariffs, slid 2.4%, dragging down the Nasdaq.

Walmart did not offer a second-quarter profit forecast, joining other companies across various sectors that have revised or withdrawn their outlooks, signaling growing concerns about tariff-related uncertainty.

The effects of tariffs on major retailers are becoming increasingly apparent, as companies like Walmart and Amazon face higher costs, which are expected to be passed on to consumers. This shift could have wider economic implications, including the potential for higher inflation. Retailers are struggling to balance profitability with maintaining competitive pricing while grappling with the ongoing trade dispute.

The S&P 500 rose 0.41%, closing at 5,916.93 points. The Nasdaq dipped 0.18%, settling at 19,112.32 points, while the Dow Jones Industrial Average gained 0.65%, ending at 42,322.75 points.

Of the 11 S&P 500 sector indexes, eight posted gains, led by utilities with a 2.1% increase, followed by a 2% rise in consumer staples. Despite recent gains, the S&P 500 remains about 4% below its record high closing on February 19.

Earlier in the day, data revealed that U.S. retail sales growth slowed in April, while another report showed an unexpected drop in producer prices. This came after a relatively muted consumer price reading earlier in the week. "We're still waiting for that inflation pop. It's not here yet, but we're still waiting," said John Augustine, chief investment officer of Huntington National Bank.

Advancing stocks outnumbered declining ones in the S&P 500 by a 2.9-to-1 ratio. The S&P 500 recorded 15 new highs and six new lows, while the Nasdaq saw 51 new highs and 107 new lows. Volume on U.S. exchanges was higher than usual, with 17.9 billion shares traded, compared to an average of 16.8 billion shares over the last 20 sessions.