“When we were heading into this earnings season, the estimates had come down, but the S&P itself was still in a situation where sentiment was high and correcting,” Sam Turner, a fund manager with Richmond, Virginia-based Riverfront Investment Group LLC, said in the phone interview. His firm manages $3.7 billion. “That can play itself out with a consolidation.”
UnitedHealth dropped 3.7% to $59.73. The biggest U.S. health insurer reported higher costs for patients on Medicare, the U.S.-funded program for the elderly, and trimmed its full-year revenue forecast by about $2 billion because a private employer converted to a less-profitable contract.
Humana Inc., the second-largest Medicare insurer, slipped 3.1% to $72.26. Health-care companies in the S&P 500 fell 1.4% as a group.
EBay slumped 5.6% to $52.97. The operator of the largest Internet marketplace said first-quarter sales amounted to $3.75 billion, missing the average analyst estimate. Second- quarter revenue will be $3.8 billion to $3.9 billion, lower than the average projection for $3.95 billion, the company said.
“The market was more ripe for hiccups and we’re seeing it,” David Sowerby, who helps oversee about $185 billion at Loomis Sayles & Co. in Bloomfield Hills, Michigan, said by phone. “We had a long run. Sentiment got more bearish and the earnings season has been a series of C plus.”
The Nasdaq Composite Index tumbled to the lowest level since February. SanDisk Corp., a maker of flash memory for mobile devices, fell 7.7% to $51.46. The company said it isn’t increasing spending on new plants and equipment and doesn’t expect enough output to meet all of the orders it receives this year.