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How major U.S. stock indexes fared on Wednesday

How major U.S. stock indexes fared on Wednesday

The Dow Jones Industrial Average had plunged more than 300 points by mid-afternoon with no sign of a rebound before the closing bell.

The lift in yields across the curve certainly caught the attention of stock investors, contributing to losses of 0.7% for the Dow Jones Industrial Average and the S&P 500. The amount outpaced expectations of 185,000 jobs.

The Nasdaq Composite was down 12.48 points, or 0.17 per cent, at 7,493.29.

UNDER THE WEATHER: Health care stocks, including several drugmakers, were among the biggest decliners for the second day in a row.

Among the S&P 500's 11 major sectors, technology.SPLRCT gave the biggest boost to the index. It is still up 5.57 percent on the year.

"It's just profit-taking", said Jeffrey Schulze, an investment strategist at ClearBridge Investments.

Healthcare stocks continued to weigh on the three major U.S. indexes following a report on Tuesday that Amazon.com (AMZN.O), Berkshire Hathaway (BRKa.N) and JP Morgan Chase (JPM.N) were joining forces to cut healthcare costs for its United States employees. "We've gone the longest in over 100 years without a 5 percent pullback, so we think this is overdue".

Wall Street wags cited a number of culprits conspiring to spoil the bull market party. Another surge in rates could trigger an even steeper drop in stock prices. The sharp increase in bond yields is finally becoming a topic of discussion.

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. You got negative news on the Apple iPhone X sales.

Declining issues outnumbered advancing ones on the NYSE by a 3.39-to-1 ratio; on Nasdaq, a 1.75-to-1 ratio favoured decliners.

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. A central explanation for this could be investors are looking to add some hedging to their portfolios" as stocks continue to rise. We are not saying yields are going to scream higher. UnitedHealth fell after Amazon, J.P. Morgan Chase and Berkshire Hathaway announced plans to partner on ways to cut health-care costs. The U.S. Labor Department is due to release its more comprehensive report on Friday.

It measures the daily stock price movements of 30 large, publicly-owned USA companies. Chevron slipped 2.53 percent, Coca Cola was down slightly and Apple sank on reports of fading iPhone X demand. Sydney's S&P-ASX 200 added 0.3 percent. Investors also are watching for President Donald Trump's State of the Union address late today.

The bond market is unnerving stock investors.

Earlier this week, the Dow lost 540 points over two days, its worst back-to-back percentage drop since September 2016.

Stepehn Massocca is a managing director at Wedbush Equity Management.

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