Robinhood Drops From S&P 500 — Domino Effect Hits Entire Market

Wall Street wrapped up Monday's trading with modest gains, led by advances in Amazon and Alphabet stocks. Meanwhile, global investors closely monitored the renewed dialogue between the United States and China amid ongoing efforts to ease trade tensions that have plagued markets for much of the year.

Senior officials from both nations resumed negotiations, aiming to solidify progress after a preliminary trade deal briefly tempered tensions last month. The renewed communication is seen as a cautious step toward long-term stability between the world's largest economies.

Amazon's stock climbed over 1% following the announcement of a major infrastructure push. The tech giant revealed plans to invest at least $20 billion in data centers across Pennsylvania, reinforcing its broader commitment to artificial intelligence and cloud infrastructure.

Amazon's Strategic Investment Overview:

Sector

Investment Amount

Data centers in PA

$20+ billion

AI and cloud expansion

Multi-billion dollars

Apple, however, saw its shares dip 1.2% after unveiling a slate of relatively minor software upgrades during its annual developer conference. The updates failed to inspire investors looking for bold innovation.

Shares of Warner Bros. Discovery fell by about 3% after the company revealed plans to separate its studio and streaming divisions from its struggling cable networks. The announcement initially sent the stock soaring 13%, but the optimism quickly faded as market participants weighed the risks of such a structural overhaul.

McDonald's stock dipped 0.8% following a downgrade by Morgan Stanley, which revised its outlook from "Overweight" to "Equal Weight."

Key Reasons for Downgrade:

Speculation proved unfounded as Robinhood Markets was not added to the S&P 500, despite recent rumors. Shares of the online brokerage fell nearly 2% after S&P Dow Jones Indices kept the index unchanged in its latest rebalancing.

The STOXX 600 pan-European index edged down 0.2% to 552.41 early Tuesday as investors weighed mixed signals across the financial landscape.

Financial companies were hit the hardest:

Financial Services (.SXFP) -1.2%;

UBS Group AG -3.9%

UBS led the decline after the Swiss government proposed that the bank raise an additional $26 billion in capital — a move designed to bolster systemic resilience.

Despite the broader market dip, a few names stood out:

European defense stocks took a breather, with the .SXPARO subindex falling to its lowest point in over a week. The drop may signal a cooldown after recent gains or a shift in investor sentiment toward less risk-sensitive assets.

The energy sector (.SXEP) gained nearly 1%, lifted by rising crude oil prices. Investors reacted positively to signs of tightening supply and geopolitical tensions that continue to support oil's momentum.

Healthcare stocks (.SXDP) advanced 0.5%, with pharmaceutical names leading the pack.

Novo Nordisk surged around 3% following reports that Parvus Asset Management, a well-known activist hedge fund, is building a stake in the Danish drugmaker.

Healthcare Movers:

Company

Change

Catalyst

Novo Nordisk

+3%

Activist investor builds position

AstraZeneca

~+1–2%

Broader sector strength

Sanofi

~+1–2%

Positive sentiment despite US committee

Surprisingly, AstraZeneca and Sanofi rose despite news that the U.S. Health Secretary dissolved the national vaccine advisory panel, indicating continued investor confidence in vaccine producers.

UK homebuilder Bellway (BWY.L) jumped 4.1% after the company raised its full-year construction volume forecast. The revision reflects growing optimism in the British housing market, even amid economic headwinds.

Asset manager Aberdeen (ABDN.L) was the day's top performer on the STOXX 600, soaring 7.5%. The rally followed J.P.Morgan's move to upgrade the stock from "Neutral" to "Overweight", citing improvements in strategy and fundamentals.