The S&P 500 saw a day of  mixed performance as sector rotation and company-specific developments shaped investor sentiment. Intel’s rally following rumors of an Apple chip-manufacturing agreement provided strong support for the technology sector, while Eli Lilly’s decline weighed on healthcare, limiting broader market gains. Investors remained focused on earnings resilience, interest-rate expectations, and shifting momentum across mega-cap names.

Intel’s Sharp Gains Reflect Renewed Confidence in Its Foundry Strategy

Intel emerged as one of the S&P 500’s strongest performers after reports suggested the company may be nearing a foundry partnership with Apple for future chip production. While still unconfirmed, the speculation aligns with Intel’s multi-year effort to transform its foundry business into a viable competitor to TSMC and Samsung.

Shares moved sharply higher, signaling renewed investor optimism that a major U.S. tech customer could accelerate Intel’s turnaround. Analysts stressed that even a partial win from Apple would represent a strategic milestone, strengthening U.S. ambitions to expand domestic semiconductor capacity and diversify supply chains.

For Israeli investors monitoring the semiconductor sector—which plays a significant role in global ETFs and in Israel’s tech ecosystem—the rumors highlight ongoing trends toward chip diversification, domestic production, and large-scale U.S. investment in semiconductor infrastructure.

Eli Lilly Slides as Valuation and Clinical Data Pressure Healthcare Names

Eli Lilly was among the S&P 500’s notable laggards, with shares declining amid concerns related to its elevated valuation and updates tied to the company’s obesity and diabetes drug pipeline. While Lilly remains a high-performing name year-to-date, traders pointed to stretched multiples and uncertainty surrounding near-term demand growth.

Healthcare stocks broadly underperformed as risk appetite shifted toward cyclical and technology sectors. Despite Lilly’s strong long-term fundamentals driven by demand for weight-loss and metabolic treatments, the pullback reinforced the sensitivity of high-valuation pharmaceutical companies to even small shifts in clinical or regulatory expectations.

For Israeli investors exposed to U.S. healthcare ETFs and pharmaceutical equities, the move underscored how pipeline expectations, reimbursement trends, and regulatory updates continue to drive performance in an otherwise defensive sector.

Broader Market Holds Steady as Investors Weigh Mixed Signals

The S&P 500 traded within a tight range as gains in semiconductors and megacap tech balanced weakness in healthcare and consumer staples. Treasury yields remained steady, and volatility stayed muted, suggesting investors are still assessing the timing of potential Federal Reserve policy adjustments.

Strategists noted that the day’s rotation highlights lingering uncertainty about the sustainability of corporate earnings momentum heading into 2025. The technology sector continues to benefit from AI-driven capital investment, supply-chain improvements, and easing input costs. Meanwhile, defensive sectors such as healthcare and utilities lagged behind as investors moved toward higher-growth industries.

For Israeli markets—which often track U.S. sector leadership via global ETFs and tech-heavy portfolios—these trends suggest continued support for innovation-linked sectors, while defensive allocations may face pressure in the near term.

What to Watch Moving Forward

Investors will closely monitor any confirmation or denial of the rumored Intel–Apple partnership, which could significantly influence semiconductor valuations. Attention will also remain on healthcare earnings guidance, upcoming regulatory decisions, and clinical trial developments that may shape sentiment toward companies such as Eli Lilly.

With macro signals mixed and sector performance increasingly driven by company-specific catalysts, the S&P 500 may continue to experience rotational rather than directional movement. Markets will be watching for clearer indicators regarding interest-rate policy, corporate guidance updates, and the durability of tech leadership into the next quarter.