On April 18, 2025, the U.S. stock market exhibited an unusual situation where the S&P 500 rose by 0.6%, despite the Dow Jones falling by 0.8%. The main factor behind this divergence was the sharp decline in shares of UnitedHealth Group.
UnitedHealth's Stock Drop and Its Impact on Dow
UnitedHealth Group's stock fell by more than 23%, which significantly impacted the Dow index. Portfolio manager Brian Mulberry stated that ‘one stock out of 30 [in the Dow] has a greater impact than one stock out of 500 [in the S&P 500].’
Differences in Index Construction
The divergence between the indices highlights differences in their structure. The Dow, being reliant on stock prices, reacts significantly to individual company movements, making it vulnerable to sharp fluctuations. In contrast, the S&P 500, with a larger number of components, demonstrates greater resilience.
Cryptocurrency Market and Its State
Amid changes in the stock market, Bitcoin continues to dominate at 62.97% of the market with a capitalization of $1.69 trillion. Notably, this event marks a historic divergence, as the Dow experienced its first 1% drop while the S&P 500 continued to rise.
The situation in the stock market on April 18, 2025, underscores the differences in index constructions and the impact of individual companies on the broader market. These changes may raise additional questions about the stability and reliability of stock indices.
