Wall Street plunges amid concerns over Trump's agenda

March 20 (Reuters) - Wall Street drifted lower on Monday as investors anxious that President Donald Trump's plan to cut taxes and boost the economy could take longer than previously expected.

Wall Street ended mixed after a choppy session on Wednesday as investors focused on President Donald Trump's struggle to push through a healthcare bill and snapped up stocks after a steep drop the day before.

Banks benefit from higher interest rates and their stocks are sensitive to changes in expectations of how quickly the Fed will adjust rates.

"Market participants are anxious about the effects and feasibility of Donald Trump's growth program", DZ Bank strategist Birgit Figge said.

As everyone tries to understand why the stock market suffered its worst session in six months, down more than 1% for the first time since October 11th (finally, some rule #1 in terms of mean reversion ... which means heightened volatility ahead so fasten your seatbelts), my recommendation is to stop wasting your time trying to explain something that is as simple as an asset class that is priced for perfection at some point realizes that the world is not a ideal place. (We have only scratched the surface of the retail carnage that will occur if the border tax indeed makes an appearance in the final tax reform plan.) In addition, oil was down pretty sharply yesterday (about 2%), which didn't help matters.

"It's just one more day delaying talking about policy", said Ian Winer, director of trading at Wedbush Securities in Los Angeles. Utilities are the best-performing part of the S&P 500 over the last month.

The Dow Jones industrial average rose around 50 points shortly after the open, with Apple contributing the most gains.

The Nasdaq Composite was up 14.19 points, or 0.24 percent, at 5,808.02.

"Animal spirits were unleashed late a year ago, but since there haven't been any policy changes yet, it's normal for a market to pause", said Karyn Cavanaugh, senior market strategist at Voya Financial.

"There was a feeling the Fed was going to possibly be more hawkish last week". But if the bill falters in the House on Thursday or the Senate later on, investors will have "increased doubt in the ability to pass the pro-growth agenda".

The small-cap Russell 2000 also underperformed, dipping by around 2%.

The Dow Jones Industrial Average inched down 0.04 percent to end at 20,905.86 points, while the S&P 500 lost 0.20 percent to 2,373.47.

The financial sector .SPSY , which on Tuesday suffered its worst daily drop since June, lost another 0.2 percent. China's Shanghai Composite Index fell 0.76%, while Hang Seng Index shed 1.47%. The benchmark index is trading at about 18 times forward earnings estimates against the long-term average of 15, according to Thomson Reuters data.

Advancing issues outnumbered declining ones on the NYSE by a 1.18-to-1 ratio; on Nasdaq, a 1.33-to-1 ratio favored decliners.

The S&P 500 and the Dow ended lower after FBI Director James Comey told a congressional hearing he had seen no evidence to support a claim by Trump that former President Barack Obama had wiretapped his campaign headquarters in Trump Tower in NY.

The S&P 500 index showed eight new 52-week highs and 10 new lows, while the Nasdaq recorded 12 new highs and 53 new lows.

About 6.9 billion shares changed hands in USA exchanges, just below the 7.0 billion daily average over the last 20 sessions.

  • Anthony Vega