Stocks were choppy Thursday as market participants took in a fresh round of earnings reports and several major developments in the healthcare space. Wall Street also watched as chip stocks continued to sell off, with one company's quarterly results spooking this once-hot corner of the market.
At the close, the blue-chip Dow Jones Industrial Average was down 0.2% at 52,552, while the broader S&P 500 was off 0.5% at 7,533 and the tech-heavy Nasdaq Composite had slumped 1.5% to 25,881.
The Dow's losses were limited thanks to a big regulatory win for drugmaker Merck & Co. (MRK), with the healthcare stock climbing 3.3% after the Food and Drug Administration (FDA) approved its daily pill to treat cholesterol.
"Merck's approval is significant because LIPFENDRA, or enlicitide, is the first FDA-approved oral PCSK9 inhibitor," explains William Soliman, Ph.D., founder and CEO of the Accreditation Council for Medical Affairs (ACMA). "It offers the LDL-lowering power associated with injectable PCSK9 medicines in a once-daily pill."
And strategically, Soliman says, "the approval demonstrates that Merck is building beyond oncology as it prepares for Keytruda's eventual loss of exclusivity."
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The 30-stock index was also buoyed by a well-received earnings report for UnitedHealth Group (UNH, +1.2%). The country's largest health insurer by revenue and market share disclosed higher-than-expected earnings and revenue for its second quarter and raised its full-year forecast.
Track all markets on TradingView"Overall, this is an impressive beat-and-raise in Q2, which typically dictates the trajectory for the year, is highly encouraging," says Oppenheimer analyst Michael Wiederhorn, who has an Outperform (Buy) rating on the Dow Jones stock.
Taiwan Semi earnings send chip stocks lower
Elsewhere on the earnings calendar, Taiwan Semiconductor Manufacturing (TSM) posted impressive year-over-year growth in its second-quarter profit and revenue, thanks to strong demand for the tech giant's artificial intelligence (AI) chips.
TSM also gave upbeat third-quarter guidance and lifted its full-year capital expenditures budget to a range of $60 billion to $64 billion, up from its previous forecast for spending of $52 billion to $56 billion.
Track all markets on TradingViewBut the semiconductor stock fell 2.3% today. One reason for today's decline could be quarter-over-quarter revenue declines in several of its non-AI legacy technologies, says Needham analyst Charles Shi, Ph.D. "This is probably a warning sign that the higher memory prices may already be hurting mainstream semiconductor demand," he explains.
Whatever the reason, TSM's sell-off was enough to keep pressure on several chip stocks. Micron Technology (MU), for one, dropped 5.7% and is now down 26% since the start of July. Sandisk (SNDK) fell 12.6% today and is off 38% month to date. Still, the tech stocks remain 200% and 493% higher, respectively, for the year to date.
Track all markets on TradingViewAtaiBeckley soars 33% on Eli Lilly bid
In non-earnings news, AtaiBeckley (ATAI) was one of the biggest gainers on Thursday, surging 33.4% after Eli Lilly (LLY, +1.2%) said it will buy the psychedelics drugmaker for $2.8 billion in cash, with another $1 billion tied to development and regulatory milestones.
Track all markets on TradingView"Lilly is using the financial strength generated by its obesity and diabetes franchises to diversify into neuroscience and other high-need therapeutic areas," says ACMA's Soliman. And while the risks are considerable, he believes there is a substantial opportunity "because treatment-resistant depression affects patients who have already failed multiple conventional therapies."
The potential $3.8 billion purchase price is a drop in the bucket for the blue-chip drugmaker, whose cash and cash equivalents totaled $7.3 billion at the end of 2025.
