Wall Street pushes back on Trump's Tylenol claims as Kenvue rebounds

Wall Street pushed back on President Donald Trump’s medical claims about Tylenol, treating the remarks as unverified and not supported by new scientific evidence. The reaction underscored the market’s assessment that a political disclosure without new data should not dramatically alter a company’s fundamentals.

Kenvue stock rose about 6% in pre-market trading on Tuesday, following a roughly 7.5% drop a day earlier after Trump’s remarks. After the bell, the shares hovered near $17.60, about a 3.8% gain from the prior session. The volatility comes as Tylenol accounts for roughly $1 billion in annual sales for Kenvue, making the company sensitive to headlines about its best-known product. Investors had braced for a potential “bombshell” from the president, but the morning moves suggested markets viewed the development as non-fundamental.

Trump spoke at the White House on Monday, warning that Tylenol use by pregnant women might lead to autism and urging mothers not to give the drug to infants. He also called for a reconsideration of the United States childhood vaccination schedule. Federal agencies did not cite new research in association with the remarks, and investors noted the absence of new scientific evidence to support the claims.

Analysts and investors said the absence of fresh data limited any lasting market impact. James Harlow, vice president at Novare Capital Management, said investors had been “holding their breath” over what would come next, but the lack of new science appeared to reassure markets that there would be no dramatic shift in demand for Tylenol.

Kenvue was spun off from Johnson & Johnson’s pharmaceutical and medical device divisions in 2023 to operate as an independent consumer health company. In addition to Tylenol, the company markets Band-Aids, Listerine and other household brands. The stock has faced pressure in recent weeks, showing an 18% decline this month, about 24% lower over the past six months, and roughly 17.5% lower since the start of the year.

Analysts have noted that the legal risk around Tylenol remains elevated by historical litigation, though most cases have been dismissed. Citi Investment Research analyst Filippo Falorni wrote that the immediate risk of new lawsuits is limited, but cautioned that negative headlines could affect consumer sentiment around Tylenol consumption. He also anticipated a positive reaction at the opening bell on Tuesday, given the absence of new scientific data.

The episode arrives as Health and Human Services Secretary Robert F. Kennedy Jr., a vaccine skeptic who leads the Make America Healthy Again movement, has sought to foreground questions about autism’s potential causes. Kenvue, which has repeatedly disputed any link between its products and autism, noted that avoiding Tylenol when it is needed could force parents to choose between fever management and riskier alternatives.

Beyond Tylenol, Kenvue’s portfolio includes Band-Aids, Listerine and other consumer health brands. The company has emphasized leveraging its brand strength and efficiencies gained since the spin-off from Johnson & Johnson, aiming to operate independently while maintaining the scale of its well-known products.

This is breaking news. Updates to come.