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NEW YORK (AP) — Stocks dropped sharply Thursday after the Supreme Court upheld the central provision of President Barack Obama's health care overhaul, a requirement that almost all Americans carry health insurance.
The Dow Jones industrial average, which was down about 100 points before the court ruled, fell further and was down 136 points at 12,491 at noon Eastern.
Health care stocks were down significantly, but bank stocks were the biggest losers in the market. The court ruled that the requirement to have health insurance can be construed as a tax. Under the law, Americans must either carry health insurance or pay a penalty.
JPMorgan fell the most of the 30 stocks in the Dow average after the New York Times reported that its loss from a complex trade that went wrong could swell to $9 billion, much larger than the bank has acknowledged. The bank had said previously the loss was $2 billion but could get larger. JPMorgan lost $1.10, or 3 percent, to $35.69.
Stocks of major insurance companies fell sharply as analysts sorted through the ruling. UnitedHealth Group declined 3 percent, WellPoint almost 6 percent and AFLAC 1.5 percent.
Hospital chains rose. Hospital Corp. of America was up 7 percent. Quest Diagnostics, which runs laboratories, was up 2.5 percent.
Investors were also punishing bank stocks because British regulators escalated their inquiry into the manipulation of a key interest rate. Citigroup, Britain's HSBC, Switzerland's UBS and the Royal Bank of Scotland were also named by British regulators in the probe.
Barclays Bank of Britain has already been fined $453 million for manipulating the benchmark interest rate to its advantage between 2005 and 2009. The London interbank offered rate, or LIBOR, is used for setting rates on a wide variety of loans including consumer loans and mortgages.
The U.S.-listed shares of Barclays plunged 15 percent, giving up $1.84 to $10.49. UBS lost 50 cents to $11.02 and Citigroup fell 50 cents to $26.58.
Bank stocks fell the most of the 10 industries tracked by the Standard & Poor's 500 index. All 10 indexes were down.
There was little for investors to like in new reports on the U.S. economy.
The U.S. economy grew at an annual rate of just 1.9 percent in the January-March quarter, according to a new government estimate. Consumer spending, which accounts for a huge part of the economy, grew 2.5 percent, below the previous 2.7 percent estimate. The four-week average of applications for unemployment benefits didn't decline, a sign that layoffs aren't easing.
In other trading, the Standard & Poor's 500 index fell 13 points to 1,319 and the Nasdaq composite index fell 40 points to 2,836.
News Corp. fell 1 percent after the media conglomerate said it would separate its publishing and entertainment businesses into two public companies. The stock or Rupert Murdoch's sprawling media empire, which includes The Wall Street Journal, the Fox TV network, Fox News Channel and newspapers in Australia and Britain, gave up 35 cents to $21.96.
Family Dollar Stores fell $2.23 to $66.90 after the discount retailer of household goods and food reported earnings and revenue that were short of what Wall Street analysts were expecting.
Paychex dropped $1.21 to $30.72. The company, which provides payroll, human resources and benefits services to employers, reported revenue was shy of what analysts were expecting.