US STOCKS-Wall St drops 1 pct as health stocks weigh; Nasdaq erases 2018 gains

12/17/18 Business for Breakfast
December 17, 2018
Wall Street drops 1 percent as health stocks weigh; Nasdaq erases 2018 gains
December 18, 2018

US STOCKS-Wall St drops 1 pct as health stocks weigh; Nasdaq erases 2018 gains

* Health stocks hit by judge ruling Obamacareunconstitutional

* All 11 sectors drop, with smallest gains in defensives

* Fed is expected to raise rates at FOMC meeting on Wed

* Nasdaq drops 1.32 pct to erases year-to-date gains (Updates prices to open)

By Amy Caren Daniel

Dec 17 (Reuters) – Wall Street slid 1 percent on Monday, ledby healthcare stocks after a federal ruling that Obamacare wasunconstitutional, with the decline in the market-leading sectorfurther unnerving investors already concerned about slowingglobal growth.

The latest slide erased the Nasdaq’s .IXIC slim gains forthe year, with the U.S. markets experiencing their worstDecember performance in over 80 years. The Dow Industrials .DJI ended Friday 10 percent below its record closing high tojoin the S&P 500 .SPX and Nasdaq in what is known ascorrection territory.

A host of health insurers and hospital operators fell onMonday after a federal judge on Friday ruled that the AffordableCare Act, commonly known as Obamacare, was unconstitutionalbased on its mandate requiring people buy health insurance.*:nL1N1YK023

The S&P healthcare index .SPXHC dropped 1.53 percent tocede its position as the best performing S&P sector this year tothe defensive utilities index .SPLRCU , which was off 0.48percent on Monday.

In fact, all the 11 major sectors were lower, with thesmallest declines being logged in the real estate .SPLRCR andconsumer staples .SPLRCS indexes, also considered defensivealong with utilities.

“We took a big hit on Friday, and what we’re seeing now isan uncertain market,” said Peter Cardillo, chief marketeconomist at Spartan Capital Securities in New York.

Financial companies .SPSY dropped 0.77 percent ahead of awidely expected interest rate increase at the Federal Reserve’sTuesday-Wednesday monetary policy meeting.

But investors are hoping the central bank may ease up onhikes next year amid rising worries of slowing global growth andPresident Donald Trump on Monday again criticized the Fed for”even considering” a rate hike.**:nL1N1YM0EW

At 9:55 a.m. ET the Dow Jones Industrial Average .DJI wasdown 262.53 points, or 1.09 percent, at 23,837.98, the S&P 500 .SPX was down 28.54 points, or 1.10 percent, at 2,571.41 andthe Nasdaq Composite .IXIC was down 90.92 points, or 1.32percent, at 6,819.75.

Insurer UnitedHealth Group IncUNH.N fell 2.14 percent andwas the biggest drag on the Dow. Johnson & JohnsonJNJ.N continued its slide with a 2.2-percent drop in the wake of aReuters report that the pharma major knew for decades that itsBaby Powder contained asbestos.*:nL3N1YG4KG

Meanwhile, Goldman Sachs Group IncGS.N fell 2.6 percentafter Malaysia filed criminal charges against the bank and twoformer employees in connection with the 1MDB investigation.*:nL3N1YM2KG

Declining issues outnumbered advancers for a 3.38-to-1 ratioon the NYSE and a 2.87-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week high and 89 new lows,while the Nasdaq recorded four new highs and 294 new lows. (Reporting by Amy Caren Daniel in Bengaluru) (( ; within U.S. +1 646 2238780; outside U.S. +91 80 6749 9250 ; Reuters