NEW YORK — U.S. stocks flirted with sharp losses but managed a mixed finish after Republicans canceled a vote on their health care bill because it became clear the bill would fail. Investors didn’t trade much as they waited for answers about the state of President Donald Trump’s business-friendly agenda.
For the second day in a row, stocks started higher and wilted as it became clear the health care bill was in trouble. The Dow Jones industrial average plunged as much as 126 points in afternoon trading on reports of the bill’s impending failure, although Wall Street cut its losses after the vote was canceled. Consumer-focused companies like Nike, Starbucks and clothing company PVH rose.
The health care act became something of a proxy for the rest of the Trump agenda and it dominated the market for most of this week. It was the week run for stocks since the week before the presidential election. Banks and small-company stocks, which made huge gains after Trump was elected, both suffered their biggest losses in more than a year.
After the close of trading, House Speaker Paul Ryan said Republicans will proceed with tax reform proposals, but acknowledged the health care debacle will make that task more difficult.
The Standard & Poor’s 500 index finished down 1.98 points, or 0.1 percent, at 2,343.98. The Dow lost 59.86 points, or 0.3 percent, to 20,596.72 as Goldman Sachs and Boeing sank. Technology companies inched higher and the Nasdaq composite rose 11.04 points, or 0.2 percent, to 5,828.74. The Russell 2000 index of smaller-company stocks added 1.22 points, or 0.1 percent, to 1,354.64.
Trading was relatively quiet, which may have contributed to the big fluctuations.
Hospitals and insurers that do a lot of business with Medicaid celebrated the demise of the bill. HCA Holdings, the largest U.S. hospital company, climbed $2.87, or 3.5 percent, to $86.04 and Community Health Systems jumped 84 cents, or 9.7 percent, to $9.54. Among Medicaid-focused companies, Centene and Molina Healthcare each gained about 5 percent.
The American Health Care Act would likely have left more Americans uninsured and would make big changes to Medicaid, a joint federal-state health program for low-income Americans. Those stocks fell when it was introduced those stocks fell because investors were concerned hospitals would have to take in more patients who lack insurance and that insurers would get less money from Medicaid.