Health care companies lead US stocks lower in midday trading

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Health care companies lead US stocks lower in midday trading
A Nasdaq employee works at the Nasdaq MarketSite, in New York, Tuesday, Jan. 30, 2018. Health care stocks are leading U.S. indexes broadly lower in early trading following news of a big new venture in the health care business. (AP Photo/Richard Drew)

U.S. stocks fell sharply in midday trading Tuesday, pulled down by hefty losses in health care and technology companies. Financial and industrial stocks also accounted for a big slice of the decline. Energy companies fell as crude oil prices headed lower. The broad slide put the stock market on course for its first two-day losing streak in more than a month.

KEEPING SCORE: The Standard & Poor’s 500 index fell 27 points, or 1 percent, to 2,826 as of 12:11 p.m. Eastern Time. The Dow Jones industrial average slumped 319 points, or 1.2 percent, to 26,119. The Nasdaq lost 56 points, or 0.8 percent, to 7,409. The Russell 2000 index of smaller-company stocks gave up 11 points, or 0.7 percent, to 1,587. The market’s last two-day losing streak was in late December. The VIX, a measure of how much volatility investors expect in stocks, was up 4.8 percent, its highest level since August.

THE QUOTE: “Is it profit-taking? Probably a little bit of that,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management. “There’s too much positive economic momentum going on right now, but certainly two significant down days makes you wonder if there’s something else going on that we’re not recognizing.”

BUSY WEEK: The sell-off comes during a week with no shortage of potential market-moving corporate news and economic data. Several big-name companies are due to report quarterly results on Wednesday and Thursday, including Apple, Amazon, Microsoft, Facebook and Google’s parent company Alphabet. Also on investors’ radar: Tuesday night’s State of the Union address and a two-day meeting of the Federal Reserve’s policymaking committee that wraps up Wednesday.

HEALTH SCARE: Health care sector companies slumped on news that Amazon is teaming up with Warren Buffett’s Berkshire Hathaway and JPMorgan Chase to create a company that helps their U.S. employees find quality care at a reasonable cost. The venture, whose initial focus would be on developing technology, is in its early planning stage. Express Scripts tumbled .71, or 7 percent, to .21. Cigna slid .91, or 5.8 percent, to .99. UnitedHealth Group lost .19, or 3.3 percent, to .22.

HCA bucked the trend after the hospital chain posted better fourth-quarter results than analysts had expected. The stock gained .15, or 5.3 percent, to .77.

TECH SLIDE: A sell-off in technology shares continued in early trading Tuesday. Corning lost .95, or 5.7 percent, to .30.

QUEASY RIDER: Harley-Davidson tumbled 8.9 percent after the motorcycle manufacturer said shipments will decline again this year. The company also plans to close a plant in Kansas City, Missouri. The stock gave up .94 to .36.

SOFTWARE BUYOUT: Callidus Software jumped 10.2 percent after the business software company agreed to be bought by SAP for a share, or .53 billion. Callidus’ shares added .35 to .05.

ECONOMIC DATA: The Conference Board said Tuesday its index of consumer confidence rose to 125.4 in January from a revised 123.1 in December. Meanwhile, a national housing index showed that home prices rose a sharply in November, lifted by a shortage of homes on the market.

BOND YIELDS: Bond prices fell. The yield on the 10-year Treasury rose to 2.71 percent from 2.70 percent late Monday.

ENERGY: Benchmark U.S. crude slid .19, or 1.8 percent, to .37 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, dropped 95 cents, or 1.4 percent, to .25 a barrel in London.

The slide in oil prices weighed on energy stocks. Noble Energy was down .49, or 4.6 percent, at .64.

CURRENCIES: The dollar, which fell sharply last week, declined to 108.89 yen from 108.94 yen late Monday. The euro rose to .2390 from .2389.

BITCOIN: The price of bitcoin fell 7.1 percent to ,366, according to the tracking site CoinDesk. Bitcoin futures on the Cboe Futures Exchange slid 6.8 percent to ,410.

MARKETS OVERSEAS: Major indexes in Europe declined amid investor worries that new data showing the eurozone grew in 2017 at its fastest pace in a decade could prompt the European Central Bank to wind down its monetary stimulus program earlier than expected.

The DAX in Germany lost 1 percent, while the CAC 40 in France fell 0.9 percent. Britain’s FTSE 100 gave up 1.1 percent. Indexes in Asia closed lower. Japan’s Nikkei 225 index lost 1.4 percent, while Hong Kong’s Hang Seng dropped 1.1 percent. South Korea’s Kospi sank 1.2 percent.