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Dow Jones registers biggest loss in eight months as benchmarks plunge

Last updated: 16:31 30 Jan 2018 EST, First published: 05:06 30 Jan 2018 EST

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  • Dow Jones drops 362pts

  • US crude down over 2%

  • healthcare sector stocks plunge

 

 

US stocks closed Tuesday sharply down, with the Dow Jones registering its biggest loss for eight months.

It closed over 362 points lower at 26,076.

It came as there were losses in health-care and energy firms.

US crude shed over 2.3% to stand at US$64.01 a barrel.

The broader based S&P 500 index closed over 31 points lower at 2,822.

The Nasdaq finished over 64 points lower at 7,402.

In Toronto, the TSX closed over 139 points lower at 15,955.

MID-SESSION

The confusing issue of US healthcare is never far from the headlines and today reached new ground as three titans of business came together  to announce a new partnership.

Amazon.com Inc (NASDAQ:AMZN), Warren Buffett's Berkshire Hathaway Inc (NYSE:BRK.A) and JP Morgan Chase & Co (NYSE:JPM) are teaming up to to start their own company that provides healthcare to their US employees and their families.

The news sent shockwaves through the sector and there were some notable casualties. UnitedHealth Group Inc (NYSE:UNH) lost 4.02% to US$237.52.

CVS Health Corp (NYSE:CVS) shares shed 3.81% to US$80.44.

Today's new   adds further uncertainty to an industry reeling from attempts by new companies to tackle an inefficient system.

“The health care system is complex, and we enter into this challenge open-eyed about the degree of difficulty,” said Jeff Bezos, Amazon’s founder and chief executive.

"Hard as it might be, reducing health care’s burden on the economy while improving outcomes for employees and their families would be worth the effort."

On Wall Street at mid-session, the Dow Jones is down 344 points at 26,095; the S&P 500 is off over 27 at 2,825 and the Nasdaq is down over 62 points at 7,403.

 

OPEN

US stocks started sharply lower on Tuesday with the Dow Jones tanking 244 points at 26,195.

The S&P 500 index was off 20 points at 2,833.

US crude-West Texas intermediate – lost 2.04% to stand at US$64.22 a barrel.

In Toronto, the TSX was 101 points lower at 15,993.

It comes as healthcare stocks suffered a sell-off as after tech giant Amazon (NASDAQ:AMZN), Berkshire Hathaway and JPMorgan Chase announced they would partner in an effort to cut health care costs and improve services for U.S. employees.

The announcement sent shares of many several health care companies lower.

PRE-MARKET

US healthcare stocks are taking a pounding in pre-market trade on news that Amazon.com Inc (NASDAQ:AMZN), Berkshire Hathaway Inc (NYSE:BRK.A) and JP Morgan Chase & Co (NYSE:JPM) are joining forces to start their own company that provides healthcare to their US employees and their families.

The three firms said they aim to improve employee satisfaction and reduce costs of healthcare through the independent entity, which will be "free from profit-making incentives and constraints”.

To start, the healthcare company will focus on technology solutions and will be led by Todd Combs, an investment officer at Berkshire Hathaway; Marvelle Sullivan Berchtold, a managing director at JPMorgan Chase; and Beth Galetti, a senior vice president at Amazon.

Berkshire Hathaway boss Warren Buffett said combining resources with Amazon and JPMorgan mean they can attract the country’s best talent, check the rise in health costs and enhance patient satisfaction and outcomes.

UnitedHealth Group Inc (NYSE:UNH), CVS Health Corp (NYSE:CVS) and Cardinal Health (NYSE:CAH) are all down by around 6% in pre-market trading.

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