Health care companies, banks drive stocks lower

Health care companies and banks drove U.S. stocks lower Thursday, pulling major indexes below their recent highs.

The afternoon slide, which erased gains from earlier in the day, came on news that some Republican senators' support for the GOP's proposed tax overhaul bill was faltering.

Small-company stocks, which would be among the biggest beneficiaries of the bill's reduction of corporate income tax rates, declined more than the rest of the market.

"The market is focused almost completely on the corporate tax reduction," said Quincy Krosby, chief market strategist at Prudential Financial. "And there are still concerns that some of the key Republican senators are wavering."

The losses outweighed gains among retailers, which got a boost from a government report showing that retail sales jumped in November.

The Standard & Poor's 500 index fell 10.84 points, or 0.4 percent, to 2,652.01. The Dow Jones industrial average lost 76.77 points, or 0.3 percent, to 24,508.66. The Nasdaq shed 19.27 points, or 0.3 percent, to 6,856.53. The Russell 2000 index of smaller-company stocks gave up 17.50 points, or 1.2 percent, to 1,506.95.

Despite the declines, the indexes are all on track to finish the week with a gain.

Republican Sen. Marco Rubio said Thursday he will vote against the proposed tax bill unless negotiators expand its child tax credit. The bill would increase the child tax credit to $2,000 from $1,000, but the Florida lawmaker wants more. Meanwhile, a spokesman for Republican Mike Lee said the senator is undecided on the bill.

House and Senate leaders agreed on the bill in principle on Wednesday, but were still finalizing the legislation, which they plan to unveil Friday and then move it through the Senate next week.

"With all eyes being on tax reform and getting really, really close to having it passed, now it comes down to the votes," said Tom Martin senior portfolio manager at GLOBALT Investments.

The stock indexes had been moving higher earlier in the day after the Commerce Department said that sales at retailers and restaurants jumped 0.8 percent last month. Sales in a category that mostly includes online shopping leapt 2.5 percent, while sales at electronics stores rose 2.1 percent. Furniture store sales increased 1.2 percent.

The report helped lift several retailers. Tiffany & Co. gained $3.24, or 3.4 percent, to $99.34, while Mattel added 65 cents, or 4.2 percent, to $16.24.

Health care stocks accounted for much of the market's losses. Medical care services company DaVita shed $2.27, or 3.2 percent, to $69.03.

Teva Pharmaceuticals was another big gainer. The Israeli drugmaker jumped 10.2 percent after it said that it would lay off 14,000 workers, or more than a quarter of its staff. The move is part of a global restructuring meant to salvage its ailing business. Teva's shares picked up $1.60 to $17.30.