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US: Wall Street drops as banks, health stocks weigh

Tuesday, January 17, 2017 - 23:26

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[BENGALURU] US stocks fell on Tuesday, with healthcare and financial stocks coming under pressure, as investors assessed President-elect Donald's Trump's comments on the US dollar and drug pricing.

The dollar index fell nearly 0.8 per cent on Tuesday, after Mr Trump warned that the US dollar was too strong, hurting the competitiveness of US companies.

Healthcare stocks took a beating after Mr Trump told Washington Post that he would target pharmaceutical companies over drug pricing.

US stocks and the US dollar have rallied since Mr Trump's election on bets that he would usher in an era of economic growth through fiscal stimulus. However, the rally has hit a speed bump as Mr Trump has provided little detail on his policies.

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Financials, which have benefited the most in the post-election rally, were off 1.2 per cent. Morgan Stanley fell about 1.6 per cent after reporting results.

British Prime Minister Theresa May said the country would leave the European Union's single market upon its exit from the group, but that a final Brexit deal would be put to parliamentary vote.

At 9.48am EDT the Dow Jones industrial average was down 65.33 points, or 0.33 per cent, at 19,820.4, the S&P 500 was down 8.81 points, or 0.39 per cent, at 2,265.83 and the Nasdaq Composite was down 38.28 points, or 0.69 per cent, at 5,535.83.

Gold prices surged more than one per cent, trading at a near two-month high, while the Japanese yen rose to a six-week high. Oil prices ticked up 1.5 per cent, benefiting from the weak dollar.

Tiffany & Co's shares dropped 5.6 per cent after the upscale jeweler reported disappointing performance during the holiday season.

Reynolds American were up 3.6 per cent at US$58 after British American Tobacco agreed to buy its US rival for US$49.4 billion.

Declining issues outnumbered advancers on the NYSE by 1,474 to 1,311. On the Nasdaq, 1,766 issues fell and 761 advanced.

The S&P 500 index showed four new 52-week highs and one new low, while the Nasdaq recorded 27 new highs and six new lows.

REUTERS

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