Wall Street suffers losses in healthcare stocks

Wall Street's three main indexes were on track to record their third session of losses as healthcare stocks fell and investors booked profits after a stellar run in equities this year.

The S&P 500 has risen about 11 per cent so far this year on optimism that the United States and China will soon end their bitter trade row and the Federal Reserve will be less aggressive in raising interest rates. A strong start to the week after a report that the two sides would arrive at a trade deal as early as month-end fizzled out, mainly due to a lack of any further developments.

The S&P 500 is struggling to go past the 2,800-point mark, a key resistance level, closing lower in five of the past six sessions in choppy trading. "There's nothing specific, the market has gained so much in such a short period of time, it has priced in a lot of the positive outcomes related to trade," said Aaron Clark, portfolio manager at GW&K Investment Management in Boston, MA.

"It has been a really good year for the S&P 500 and we all know that it will not continue at this pace as the risk/reward will be flat to down from here onwards, so I think its just profit taking." The healthcare sector was the biggest drag on the benchmark index, falling 1.6 per cent. Shares of big pharma and biotech companies took a hit, a day after U.S. FDA Commissioner Scott Gottlieb resigned from his post in a surprise move.

UnitedHealth Group, Amgen Inc and Pfizer Inc dropped between 1.2 per cent and 2.8 per cent and weighed on the healthcare sector. Energy slipped 1.66 per cent, the most among major S&P sectors, weighed by Exxon Mobil Corp which fell 1.7 per cent after the oil major said it planned to increase capital spending next year.

At 13:01 p.m. ET the Dow Jones Industrial Average was down 146.64 points, or 0.57 per cent, at 25,659.99. The S&P 500 was down 17.60 points, or 0.63 per cent, at 2,772.05 and the Nasdaq Composite was down 61.56 points, or 0.81 per cent, at 7,514.80. Materials sector rose 0.39 per cent, helped by a 6.1 per cent jump in LyondellBasell Industries NV after Goldman Sachs upgraded the chemicals company's shares to "buy".

General Electric Co shares tumbled 8 per cent, extending losses from a day earlier after it warned of negative net cash flow from its industrial businesses this year. The Federal Reserve's Beige Book, a compendium of anecdotes on the health of the economy drawn from the central bank's sources across the nation, is expected at 2 p.m. ET (1800 GMT).

Declining issues outnumbered advancers for a 2.94-to-1 ratio on the NYSE and for a 3.24-to-1 ratio on the Nasdaq. The S&P index recorded 13 new 52-week highs and five new lows, while the Nasdaq recorded 17 new highs and 25 new lows.