UnitedHealth shares plummet amid Medicare fraud investigation

In the United States, the stock market experienced notable fluctuations recently, primarily affecting major companies like UnitedHealth and Fiserv. The S&P 500 posted a weekly gain of 5.3%, while the Dow Jones Industrial Average returned to positive territory for 2025. However, UnitedHealth’s shares hit a five-year low after reports emerged that the Department of Justice is conducting a criminal investigation into the company regarding potential Medicare fraud. This investigation has coincided with a significant downturn, as the stock is down approximately 50% over the past month, leading investors to reassess their positions and expectations for the stock's recovery. To analyze trading behavior, the CNBC Pro stock screener tool was employed to determine which stocks were oversold and overbought based on the 14-day relative strength index (RSI) readings. UnitedHealth, with an RSI of 14.9, indicates it may be oversold, while Fiserv’s shares also fell with an RSI of 27.6. This technical indicator suggests that stocks with an RSI under 30 may see a trading rebound soon; however, sentiments can still be impacted by negative news or further complications within the company. Despite the unfavorable situation, analysts from LSEG continue to rate UnitedHealth as a buy and project that the stock could have over 64% upside potential based on recent price targets. Additionally, amidst this volatility, UnitedHealth experienced a brief recovery with a 6.4% bump in share price one day after insiders purchased shares, indicating some confidence in the company from within its management ranks. Meanwhile, Fiserv also suffered a notable decline after management announced during a technology conference that its Clover business's growth would be stagnant, which did not sit well with investors. As for other companies, stocks such as Microsoft, Broadcom, and NRG Energy appeared overbought, with NRG's stock soaring by 33% as it secured a $12 billion deal. These contrasting trends highlight the critical nature of market sentiment and investor reactions to corporate developments and broader economic signals, especially within the healthcare and technology sectors.