US stock markets closed at fresh record highs on Friday, fueled by a dramatic rally in UnitedHealth Group shares after Warren Buffett’s Berkshire Hathaway revealed a significant new stake in the troubled healthcare giant.
Dow Jones and S&P 500 Set New Records
The Dow Jones Industrial Average and S&P 500 both surged to record levels on August 15, driven largely by a sharp rebound in UnitedHealth shares. The Dow gained significant momentum after UnitedHealth stock leapt more than 10% during the trading session.
Buffett’s Bold Bet on a Troubled Giant
According to a US Securities and Exchange Commission (SEC) filing, Berkshire Hathaway owned 5.04 million shares of UnitedHealth as of June 30, 2025. The move marks Buffett’s return to the stock after previously holding 1.18 million shares between 2006 and 2009 before exiting the position in 2010.
The investment comes despite UnitedHealth’s recent challenges, including:
- Escalating operating costs.
- A US federal investigation into its government-backed health plans.
- A massive cyberattack affecting personal data of 192 million Americans.
Kevin Gade, COO of investment firm Bahl & Gaynor, described the move as “psychological reassurance to many investors” who had considered UnitedHealth “untouchable” in recent months.
Market Reaction and Share Price Movement
UnitedHealth shares traded at $303.08 by 10:19 a.m. EDT, up 11.64% from the previous close of $271.49. The rally boosted its market capitalization to $245.88 billion.
Key price stats:
- 52-week low: $234.60
- 52-week high: $630.73
- 1-year performance: Down 47.85%
- Year-to-date 2025: Down 40.08%
- Last 5 sessions: Up 18.98%
Why Buffett’s Move Matters
Warren Buffett is renowned for buying undervalued companies with long-term potential. His investment in UnitedHealth signals confidence in the insurer’s ability to recover from its current troubles. Markets interpreted the purchase as a strong endorsement, triggering buying interest and lifting overall investor sentiment.
Wider Market Optimism
In addition to the Buffett effect, broader market optimism has been building amid:
- Expectations of a Federal Reserve interest rate cut.
- A generally positive earnings season for US corporates.
- Renewed appetite for risk assets after recent volatility.
UnitedHealth’s rebound, supercharged by Buffett’s strategic investment, not only propelled its stock price but also helped push US equity markets to historic highs. While the company still faces significant operational and regulatory challenges, Friday’s rally highlights the powerful impact that a single high-profile investor can have on market confidence.