U.S. stock futures showed mixed results on the morning of March 7, 2024, with Dow futures declining approximately 0.1%. A significant factor influencing the market was the sharp decline in shares of several major health insurers, including Humana Inc, following a report from The Wall Street Journal regarding Medicare rates.
Shares of Humana Inc (NYSE:HUM) dropped by 12.2%, reaching $231.39 in pre-market trading. The decline was driven by news that the Trump administration is expected to propose rates for Medicare insurers that are largely unchanged for the upcoming year. Specifically, the proposed adjustments would result in a mere 0.09% increase in payments to plans for 2027.
Other companies in the health insurance sector also faced declines. Alignment Healthcare Inc (NASDAQ:ALHC) saw its shares decrease by 11.8%, falling to $21.00. Similarly, UnitedHealth Group Inc (NYSE:UNH) experienced an 8.8% drop to $320.53. These movements reflect a broader trend impacting the health insurance market as investors react to the anticipated stagnant rates for Medicare Advantage plans.
In addition to health insurers, a variety of stocks were affected in pre-market trading. Brand Engagement Network Inc (NASDAQ:BNAI) plummeted 32.1% to $42.15 after a remarkable surge of 277% the previous day. This followed the announcement of a $2 million agreement for an AI pilot program at Nelson Mandela University in collaboration with Valio Technologies, a South African firm.
Shares of ProPetro Holding Corp (NYSE:PUMP) fell 9.9% to $10.02 as the company announced its upsized public offering of 15 million common shares at $10 per share. CVS Health Corp (NYSE:CVS) also registered a 9.7% decline, with shares dropping to $75.73.
The downward trend in health insurance stocks continued with Elevance Health Inc (NYSE:ELV) shares falling 7.1% to $350.01. Centene Corp (NYSE:CNC) experienced a decline of 4.7%, reaching $44.12.
In the materials sector, Nucor Corp (NYSE:NUE) saw a decrease of 3.1% to $172.13 following disappointing earnings for the fourth quarter.
Overall, the pre-market session reflects significant volatility and investor caution, particularly in the healthcare sector as news regarding Medicare rates continues to influence market dynamics. As companies brace for potential adjustments in government payments, analysts will be closely monitoring developments in this area.
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