Healthcare stocks took a hammering on Tuesday, dragging the major US indexes lower, after President Donald Trump tweeted about lowering drug prices.
Trump said he was working on a new system to increase competition in the drugs industry and bring down prices.
The S&P 500 healthcare index plunged 0.91 percent, setting it up for its worst day since January 11, when Trump said drugmakers were “getting away with murder” by charging high prices.
Johnson & Johnson was the top drag on the S&P 500 and the Dow Jones Industrial Average, while Amgen had a similar influence on the Nasdaq.
The healthcare selloff could lead to the first back-to-back losses for the S&P 500 and the Dow in more than one month.
Nine of the other 11 major S&P sectors marked slight losses as investors position themselves for an interest rate hike next week.
The Federal Reserve has left no stone unturned in preparing the markets for tighter monetary policy, with an unusual number of key officials including Fed Chair Janet Yellen hinting at a rate hike in the central bank’s March 14-15 meeting.
The chances for a rate hike this month are at 83 percent, up from roughly 30 percent at the start of last week, according to Thomson Reuters data.
At 9:35 am ET (1435 GMT), the Dow was down 28.62 points, or 0.14 per cent, at 20,925.72, the S&P 500 was down 4.79 points, or 0.20 per cent, at 2,370.52 and the Nasdaq Composite was down 7.35 points, or 0.13 per cent, at 5,841.82.
Newly minted shares of Snapchat owner Snap Inc fell 8.5 per cent to $21.70 after a group representing large institutional investors asked stock index providers to bar the company and others who sell non-voting shares from their stock benchmarks.
Nimble Storage soared 45 per cent after Hewlett Packard Co said it would buy the data storage provider for $1.09 billion in cash. HPE’s stock was marginally lower.
Dish Network was up 4.4 per cent at $63.98 after the satellite TV company was picked to join the S&P 500.
Declining issues outnumbered advancers on the NYSE by 1,683 to 835. On the Nasdaq, 1,257 issues fell and 892 advanced.
The S&P 500 index showed five new 52-week highs and three new lows, while the Nasdaq recorded 11 new highs and 16 new lows.