Investing.com -- U.S. stocks fell sharply as the Dow Jones Industrial Average halted a nine-day winning streak, after European Central Bank president Mario Draghi hinted that the Governing Council could be ready to implement new easing measures following Thursday's decision to hold interest rates steady.
Draghi's comments dragged down equities on Wall Street just before Noon on Thursday, helping end the longest winning streak on the Dow in more than three years. While noting that the U.K's decision to leave the European Union has created significant headwinds on the economic outlook in the euro area, Draghi stressed that the ECB could use all of the tools at its disposal in the near-term future to boost the economy if needed. Consequently, investors in the euro area departed from their positions in U.S. equities, returning back to riskier stocks at home, amid broad signals that the ECB could lower rates and extend the scope of its Quantitative Easing program when it meets again in September.
The Dow lost 77.80 or 0.42% to 18,517.23, while the S&P 500 Composite index fell by 7.85 or 0.36% to 2,165.17, as both indices retreated from record territory on Thursday. On the S&P 500, eight of 10 sectors closed in the red, as stocks in the Energy, Industrials and Technology industries lagged. Stocks in the Utilities and Health Care sectors led, inching higher on the session. The NASDAQ Composite index, meanwhile, fell 16.03 or 0.31% to 5,073.90 , after considerable losses from Intel (NASDAQ:INTC) weighed on semiconductor stocks.
Both the Dow and S&P 500 suffered their worst one-session declines in more than two weeks.
Stocks in the health care sector crept higher after the U.S. Department of Justice blocked a pair of proposed mergers among four major health insurance companies. On Thursday morning, attorneys from the Justice Department and several state attorney general offices filed lawsuits to contest Anthem Inc 's (NYSE:ANTX) $54 billion acquisition of Cigna Corporation (NYSE:CI) and Aetna Inc 's (NYSE:AET) $37 billion takeover of Humana Inc (NYSE:HUM). Had the Justice Department allowed the mergers to proceed, U.S. attorney general Loretta Lynch said the deals would have reduced the number of major health insurers in the U.S. from five to three, severely restraining competition in the marketplace. Both Humana and Cigna surged by more than 5% on the session.
"These mergers would restrict competition for health insurance products sold in markets across the country and would give tremendous power over the nation’s health insurance industry to just three large companies," Lynch said in a statement. "Our actions seek to preserve competition that keeps premiums down and drives insurers to collaborate with doctors and hospitals to provide better healthcare for all Americans."
The top performer on the Dow was McDonald’s Corporation (NYSE:MCD), which added 1.12 or 0.89% to 127.18. Earlier, McDonalds announced plans to expand its Garlic Fries promotion across California. McDonald's (NYSE:MCD) shares also recovered from Wednesday's losses triggered by the delay of Nintendo's release of Pokemon Go in Japan. The fast-food giant became the first company on Wednesday to sponsor the popular app by designating 3,000 of its restaurants nationwide as Pokemon gyms. The worst performer was Intel, which tumbled 1.42 or 3.98% to 34.27, after reporting subdued growth in its key data center segment. It marked the second consecutive quarter that growth in the division fell under 10%.
On the New York Stock Exchange, declining issues outnumbered advancing ones by a 1,719-1,254 margin.