Buffett Bails, Burry Bets, and Walmart Sounds the Alarm
- NexxtGen Markets
- 1 day ago
- 4 min read
U.S. equity futures were broadly flat in early Friday trading, following a strong week that saw optimism buoyed by easing U.S.-China tariff rhetoric and softer-than-expected inflation figures.
Dow futures edged up by just 13 points
S&P 500 futures slipped 0.01%
Nasdaq 100 futures ticked down 0.03%
While the indices remain below all-time highs, bullish sentiment is starting to return. However, under the surface, tensions are rising—from tariff-related inflation threats to regulatory probes shaking major sectors.
🩺 UnitedHealth: when titans tumble
One of the week’s biggest shocks came from UnitedHealth (UNH), which plummeted 11% following reports of a U.S. Department of Justice criminal probe into its Medicare Advantage billing practices.
Already battered by cyberattacks, executive turnover, and margin pressures, the healthcare giant’s market cap has shrunk by nearly $300 billion this year alone—raising genuine speculation about its future in the Dow Jones Industrial Average.
📉 The ripple effect on healthcare stocks and ETFs
Sector sentiment hit:If confidence in Medicare Advantage is undermined, expect broader knock-on effects for peers like Humana, CVS Health, and Elevance Health.
ETF exposure risk:UNH makes up over 8% of the XLV Health Care Select Sector SPDR ETF, which may drag down the fund even if other holdings remain stable. The Vanguard Health Care ETF (VHT) is similarly exposed.
Dow dynamics:A potential UNH exit from the Dow would prompt index fund reshuffling, introducing short-term volatility across portfolios.
Defensive no more?Traditionally seen as a safe-haven sector, healthcare may now feel less “defensive,” pushing risk-averse investors toward other plays like utilities or consumer staples.
📦 Walmart: solid quarter, storm clouds ahead
Walmart (WMT) beat earnings expectations in Q1, but missed slightly on sales—and delivered a stark warning: tariffs are going to hit consumers hard in the coming weeks.
U.S. e-commerce operations turned a profit for the first time
CFO John Rainey warned of double-digit price hikes on items like toys, furniture, and baby products
Despite a drop of 0.5% in shares, the results indicate strong fundamentals, albeit with looming macro headwinds
This warning reinforces broader inflation concerns, particularly as April retail sales came in flat at +0.1%, reversing the consumer surge seen in March. Core sales declined 0.2%, adding weight to the argument that spending is weakening in the face of cost-of-living pressures.
🏦 Buffett dumps banks, Burry shorts Nvidia
🧓 Buffett’s cautious shuffle
Warren Buffett’s Berkshire Hathaway disclosed a complete exit from Citigroup and further trimmed its stake in Bank of America—even as both stocks had strong recent runs:
Citigroup (C) is up 6.3% this week and 18% over the month
Bank of America (BAC) has gained 6.2% this week, 17% in a month
Despite the rally, the moves reflect a growing wariness towards the financial sector amid uncertain regulatory and interest rate environments.
📉 Burry’s Big Short 2.0?
Meanwhile, Michael Burry—of The Big Short fame—has taken a short position against Nvidia (NVDA). The move comes despite Nvidia surging:
+16% over four sessions
+24% in May
Still 12% below January highs
His contrarian stance suggests mounting doubts over whether the AI euphoria that has driven tech stocks is sustainable over the long term.
🔝 Market movers this week
Ticker | Name | Move | Price |
FL | Foot Locker | ▲ +86% | $23.90 |
BOOT | Boot Barn | ▲ +17% | $155.00 |
ASAI.L | Asa International | ▲ +18% | £124.00 |
ATG.L | Auction Technology Group | ▼ -10% | £487.00 |
Explore more market movers.
🧾 Earnings wrap: hits and misses
🛍️ Boot Barn (BOOT)
Shares surged 17% after Q4 revenues grew 17%, with EPS up 27%. Despite missing analyst estimates, investors were encouraged by robust same-store sales and growth guidance targeting 8–13% revenue gains in FY2026. CEO also announced a $200 million share buyback.
🚜 Deere & Co (DE)
Shares rallied 3.78% to $516, touching all-time highs. Although profits declined 22%, markets were relieved the results weren’t worse. Deere also lowered its full-year outlook, citing global agricultural uncertainty, but momentum remains solid.
🐉 Alibaba (BABA)
Shares fell 7.6% as quarterly revenues missed estimates. The Chinese e-commerce behemoth is battling a domestic price war, a sluggish property market, and trade tension volatility—all of which are pressuring margins and investor confidence.
🧪 Applied Materials (AMAT)
Posted $7.10 billion in Q2 revenue vs. $7.13 billion expected. Semiconductor revenue also missed expectations. Shares fell 5% after hours, indicating ongoing headwinds in the semiconductor equipment space, despite broader chip sector strength.
📊 Indices, yields & sentiment
The S&P 500 has risen 4.5% over the past four sessions
The Nasdaq 100 is now 4% from its peak
The Dow Jones remains 6.1% below record highs
Yields remain elevated:
30-year: 4.89%
10-year: 4.43%
2-year: 3.95%
High-yield and corporate bond ETFs remain stable, but cautious.
🔮 What’s next?
📅 Upcoming data
3:00pm GMT – University of Michigan Consumer Sentiment Index (May, prelim)
Expected: 52.0
Previous: 52.2
Watch USD crosses for potential reaction.
📉 Options expiry warning
Friday’s $3.4 trillion options expiry may introduce volatility, particularly if recent gains were driven by bullish hedging flows that begin to unwind. Expect momentum stalls next week if dealer positioning reverses.
🛢️ Oil on shaky ground
Oil dropped 3% intraday, before paring losses to -2% following suggestions from Donald Trump of progress toward a U.S.-Iran nuclear deal. Any breakthrough could lead to increased Iranian exports, compounding OPEC+ supply hikes and triggering oversupply fears well into 2025.
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