Happy Sunday, and welcome to Benzinga’s financial advisor newsletter.

Today we're discussing wiping medical debt off credit reports. A Biden-era rule to remove medical debt from credit reports is at risk after a surprising reversal by the CFPB. Consumer advocates warn that millions could continue to face credit challenges due to unpaid medical bills if the rule is vacated.

Plus, a look back at the last week of market activity.

INDUSTRY CHATTER

Trump Seeks to End Biden Era Medical Debt Rule

A federal rule that aimed to wipe medical debt off credit reports is now on shaky ground — and it could be scrapped before it even takes effect. The policy, introduced during the Biden administration, was designed to prevent medical bills from dragging down credit scores or influencing lending decisions. But now, that effort may be undone.

The Consumer Financial Protection Bureau (CFPB), the agency behind the rule, recently changed course and joined trade groups in asking a judge to vacate the regulation. According to a USA TODAY report, the agency argued that the rule exceeded its legal authority, surprising consumer advocates who expected the CFPB to defend its own policy. Originally set to take effect in March, the rule was already paused by a federal court and may now be permanently shelved.

Supporters of the rule say removing medical debt from credit reports is a commonsense reform that protects people from being penalized for unavoidable and often unexpected healthcare costs. About 15 million Americans currently have medical debt listed on their credit reports, which can make it harder to get approved for loans, credit cards, or even rental housing. Critics of the reversal warn this move could keep struggling families stuck in a cycle of bad credit caused by something as common as an emergency room visit or surgery.

On the flip side, credit industry groups argued the rule would restrict lenders from seeing the full picture of a borrower’s financial situation. They believe access to complete information — including medical debt — helps lenders make more informed decisions and benefits borrowers in the long run.

The debate comes as credit reporting practices are already evolving. In recent years, the major credit bureaus voluntarily removed certain types of medical debt, including paid bills and debts under $500. Still, a large chunk of unpaid medical bills remains, and without a clear federal rule, it’s up to the courts and individual lenders to decide how that information is used.

MARKET RECAP

Wall Street Fully Recoups Tariff-Led Losses, Economy Contracts In First Quarter Yet April Payrolls Remain Strong

Wall Street extended its rally this week, fully erasing the losses suffered after the Trump administration's tariff announcement on April 2.

Investor sentiment was buoyed by encouraging developments in trade negotiations and, most importantly, a stronger-than-expected start to earnings season.

Corporate America showed resilience in the face of trade headwinds. Mega-cap tech giants —including Microsoft Corp., Meta Platforms Inc., Apple Inc., and Amazon.com Inc. — all surpassed Wall Street estimates, with Microsoft logging its best weekly performance in years.

The S&P 500 posted its second consecutive weekly gain, marking its longest winning streak since May 2024.

Top individual performers included Arista Networks Inc. and Carrier Global Corp., both soaring roughly 20% for the week. On the downside, Becton, Dickinson and Company tumbled 20%, making it the worst performer.

Michigan-based automaker General Motors Co. topped earnings forecasts yet withdrew guidance for the year amid "massive uncertainty” over tariffs.

From a sector perspective, industrials and technology led the charge, while energy stocks lagged as crude oil prices slumped. Oil marked its second-worst week of the year, falling to $58 per barrel after Saudi Arabia signaled its readiness to cope with lower prices, stoking speculation that OPEC+ may boost output further in the coming months.

President Donald Trump's threat to impose secondary sanctions on nations buying Iranian oil failed to stabilize crude prices, which continued to slide.

Macroeconomic data painted a mixed picture. First-quarter gross domestic product shrank by 0.3%, missing forecasts of a 0.4% rise, largely due to a surge in imports.

Yet, inflation and employment data provided a more positive outlook. Nonfarm payrolls rose by 177,000 in April, beating the 130,000 consensus and underscoring labor market strength.

Meanwhile, Personal Consumption Expenditure inflation cooled: annual price gains slowed from 2.7% in February to 2.3% in March. Core PCE, the Federal Reserve's preferred inflation gauge, eased to 2.6% year over year, aligning with expectations and down from 3%.

Looking ahead, markets will focus on the Federal Reserve's two-day policy meeting starting Tuesday. While no rate change is anticipated, Chair Jerome Powell's Wednesday press conference will be closely watched, especially after renewed calls from President Trump to cut interest rates.

THE WEEK AHEAD

Palantir, Disney and Ford report earnings, US Fed Chair Powell speaks, CAN unemployment change, and more

Economic Data

• Monday: US S&P final services PMI

• Tuesday: US trade deficit and 10-year note auction

• Wednesday: US Fed Chair Powell speaks, crude oil inventories and consumer credit

• Thursday: US initial jobless claims, GBP BoE interest rate decision

• Friday: CAN unemployment change, US Fed Waller speaks

Earnings

• Monday: Palantir Technologies (PLTR), Ford Motor Company (F)

• Tuesday: Advanced Micro Devices (AMD), Ferrari N.V. (RACE)

• Wednesday: Novo Nordisk A/S (NVO), Uber (UBER), Disney (DIS)

• Thursday: Shopify (SHOP), Anheuser-Busch (BUD), Coinbase Global (COIN)

• Friday: Enbridge (ENB), Honda Motor Company (HMC)

Click here for the full calendar of economic data and earnings reports.

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