Trump tweet sends pharma lower
US stocks pared losses on Tuesday morning as a decline in drug stocks, triggered by US President Donald Trump's tweet about lowering drug prices, was countered by gains in technology shares.
Pharmaceutical stocks came under fire after Mr Trump said he was working on a new system to increase competition in the drugs industry and bring down prices.
Trump also backed a draft bill unveiled by Republicans on Monday to repeal and replace the Obamacare healthcare law but said the bill was open to negotiation.
The S&P 500 healthcare index dropped 0.54pc, setting it up for its worst day in more than five weeks.
Johnson & Johnson was the top drag on the S&P 500 and the Dow Jones Industrial Average, while Amgen weighed the most on the Nasdaq. However, a 0.4pc advance in the S&P technology sector, led by gains in Apple and Microsoft helped offset the impact of the decline in drug stocks.
"What you have going on is a market that is sort of in a quiet period," said Robert Pavlik, chief market strategist at Boston Private Wealth. "It's a week away from the Federal Reserve (meeting). The president came out last week and make a very good speech, but that sentiment has quickly dissipated."
Eight of the 11 major S&P indexes were lower as investors braced for an interest rate hike next week. The chances for a rate hike this month are at 83pc, up from roughly 30pc at the start of last week, according to Thomson Reuters data.
The Federal Reserve has been preparing the market for tighter monetary policy, with an unusual number of key officials including Fed Chair Janet Yellen hinting at a rate hike in the central bank's March 14-15 meeting.
The Iseq overall index of Irish shares closed down 6,600.86, losing 57.84 points, or 0.87pc.