United States stocks close lower on sell-off

Hefty losses in health care and technology companies led USA stocks sharply lower Tuesday, handing the market its biggest pullback since August and its worst two-day drop since May. Health insurer UnitedHealth fell 4.3 percent, the most among Dow components, while Cigna's 6.4 percent drop was the biggest on the S&P 500. USA stocks also posted the biggest drop of the new year.

Wall Street pulled back from record highs on Monday, with the Dow and the S&P 500 indexes marking their biggest one-day percentage declines in about five months, weighed down by a slide in Apple shares, reports Reuters.

The S&P 500 was down 27.82 points, or 0.97 per cent, at 2,825.71 and the Nasdaq Composite was down 60.17 points, or 0.81 per cent, at 7,406.33.

Art Hogan, chief market strategist at B. Riley FBR said: "We've had a unilateral move higher [in stocks] to start things off and people are realising this is not sustainable".

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Nasdaq 100 futures climbed 0.4%, as Apple (AAPL) dragged lower and despite gains by all four FANG stock tech leaders.

Yields, which rise as bond prices fall, have ticked higher in recent sessions, as investors have bet on an uptick in growth and inflation following the passage of US corporate tax cuts. Personal Spending rose 0.4%, but this was slightly below the 0.5% estimate. That's the biggest one-day drop since August 17. The Russell 2000 index of smaller-company stocks gave up 15.29 points, or 1 percent, to 1,582.82.

Aside from higher yields, telecom stocks also slipped on reports that the USA government was considering building a 5G wireless network to guard against spying.

Among earnings, Pfizer shares fell 3.3 percent. But some investors speculated that the growing strength in the USA economy and labor market could prompt the central bank to perhaps forecast an extra rate increase this year. Brent crude, used to price worldwide oils, dropped 44 cents, or 0.6 percent, to close at $69.02 a barrel in London.

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Beside a host of earnings reports, this week includes U.S. President Donald Trump's State of the Union address, the Federal Reserve's monetary policy meeting and the U.S.jobs report.

The Dow rose 238 points, or 0.9 per cent, to 26,318.

Other major indexes followed the Dow.

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