NEW YORK (AP) — Health care stocks tumbled Thursday after the Supreme Court upheld most of President Barack Obama's health care overhaul, falling along with major banks as Wall Street worried about the European debt crisis and the sluggish U.S. economy.
It had already been a bad morning for the market, which was dragged down sharply by news about regulatory investigations at Barclays, JPMorgan Chase, Citigroup and others.
Then, the high court upheld a key provision of the health care law, and the losses accelerated.
Although health care and finance dominated the headlines, the market's concerns were more widespread, stretching to numerous types of companies and economic data.
The Commerce Department said the American economy expanded at a 1.9 percent annual rate in the first quarter, a weak pace that isn't expected to pick up. The government also reported that unemployment applications fell last week, but only slightly, and analysts worried that the claims are still too high to indicate a recovery.
News Corp, parent of the Wall Street Journal and the 20th Century Fox movie studio, fell after it said it planned to split into two companies. Family Dollar declined after reporting that it missed analysts' estimates for revenue and profits.
Major indexes in France, Britain, Germany and Greece were down as the European Union met in Brussels. Leaders are trying to hammer out how to deal with the weakest countries, like Greece and Spain, but many of the previous meetings have failed to produce concrete plans.
"The first one thousand summits, I was pretty excited," deadpanned Jeff Sica, president and chief investment officer of SICA Wealth Management in Morristown, N.J.
David Lefkowitz, senior equity strategist at UBS wealth management research in New York, was also watching Europe more than the health care ruling or the bank probes. Health insurance companies make up only about 1 percent of the Standard & Poor's 500, he said.
And even concerns about the indirect effects of the health care law — like whether it will cause small businesses to curb hiring — can get overblown, he said. The much bigger cost of hiring is still salaries.
In the U.S., the Dow Jones industrial average fell throughout the morning. It was already down about 100 points by 10 a.m., 30 minutes into trading and just before the Supreme Court released its decision. It fell as much as 165 points later in the morning, then recovered some of those losses.
By 1 p.m., it was down 128 points, or about 1 percent, to 12,499. Thursday could be the Dow's second triple-digit loss this week.
The S&P 500 fell 13 points to 1,318. The Nasdaq composite index fell 43 points to 2,833.
JPMorgan was down 4.5 percent, more than any other company in the Dow index of 30 stocks. The New York Times reported early Thursday that a trading loss there, previously estimated at about $2 billion, could top $9 billion. JPMorgan's stock has lost 14 percent since then, compared to 3 percent for the Dow.
The U.S.-listed shares of Barclays plunged 15 percent. Regulators in the U.S. and the U.K. on Wednesday announced that the British bank would settle accusations that it had manipulated international interest rates, which are important because they affect how much consumers pay on mortgages and other loans.
On Thursday, banking stocks got another dose of unwelcome news when British regulators announced that their investigation had expanded to Citigroup, Britain's HSBC, Switzerland's UBS and the Royal Bank of Scotland'.
Financial stocks fell more than any of the other nine industry groups on the S&P 500, losing 1.7 percent in the afternoon.
Health care stocks fell 1 percent, led by sharp declines in insurers like UnitedHealth Group, WellPoint and Aetna.
But hospitals had the opposite reaction, with stocks rising notably at Hospital Corp. of America and Community Health Systems.
The reasons for the disparity weren't clear cut.
The health care law will require all Americans to carry insurance. So for hospitals and related industries, like companies that make surgical instruments or lab equipment, that can mean more customers.
It also means more customers for insurance companies. But some of those customers won't be as profitable as the companies might like, such as those who are already sick.
Even with the ruling in hand, there's plenty of uncertainty overhanging the issue. Small businesses aren't sure how much money to set aside now that more of them will be required to insure their employees. The health care law also doesn't address the overhanging problem of looming deficits in Medicare.
"It's not like we're at the end of the road here," said Gerard Wedig, a health care economist at the University of Rochester, "where our health care problems are solved."