What Happened?

A number of stocks jumped in the afternoon session after the market experienced a sharp sector rotation, as investors fled growth-oriented technology stocks and piled into value-oriented names amid growing valuation concerns. This divergence was stark: the tech-heavy Nasdaq struggled, losing 0.2%, while the Dow rallied. This shift away from tech was triggered by a series of negative catalysts in the AI sector. AI cloud provider CoreWeave slid on disappointing guidance, while chip darling Nvidia pulled back after SoftBank sold its stake. This "hurt the AI trade," dragging down related names like Micron and Oracle. As capital left tech, it sought safety in "higher quality" defensive names. Health care giants like Merck, Amgen, and Johnson & Johnson saw significant buying, boosting the Dow.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Therapeutics company Gilead Sciences (NASDAQ: GILD) jumped 3.4%. Is now the time to buy Gilead Sciences? Access our full analysis report here, it’s free for active Edge members.
• Therapeutics company Moderna (NASDAQ: MRNA) jumped 5%. Is now the time to buy Moderna? Access our full analysis report here, it’s free for active Edge members.
• Medical Devices & Supplies - Cardiology, Neurology, Vascular company Artivion (NYSE: AORT) jumped 3.6%. Is now the time to buy Artivion? Access our full analysis report here, it’s free for active Edge members.
• Hospital Chains company Tenet Healthcare (NYSE: THC) jumped 2.6%. Is now the time to buy Tenet Healthcare? Access our full analysis report here, it’s free for active Edge members.
• Drug Development Inputs & Services company Charles River Laboratories (NYSE: CRL) jumped 3.1%. Is now the time to buy Charles River Laboratories? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Moderna (MRNA)

Moderna’s shares are extremely volatile and have had 53 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 8 days ago when the stock dropped 6.9% on the news that ongoing concerns about its financial performance and a recent clinical setback overshadowed an announcement about a new, early-stage study. While Moderna announced it had dosed the first patient in a Phase 1/2 study for a multiple myeloma therapy, investors looked past this development. Instead, attention remained on the company's challenging financial situation. The company's Q2 2025 revenues had fallen, with product sales down 38% from the previous year, and other financial metrics showed significant negative margins. Moreover, analysts forecasted the company would report a substantial quarterly loss with revenues declining by over 53% compared to the year-ago quarter. The negative sentiment was also compounded by the recent failure of a separate, late-stage vaccine trial, which tempered any optimism from the day's announcement.

Moderna is down 37% since the beginning of the year, and at $26.46 per share, it is trading 44.3% below its 52-week high of $47.53 from January 2025. Investors who bought $1,000 worth of Moderna’s shares 5 years ago would now be looking at an investment worth $321.02.

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