Dow dives 700 points as latest data raise alarms about slowing economy

Wall Street’s main indexes were set for weekly declines on Friday, as fresh data painted a weak picture for the American economy, while UnitedHealth dropped after a report that the Justice Department is investigating the healthcare conglomerate.In afternoon trading, the Dow Jones Industrial Average slumped 704 points, or 1.6%, to 43,472.The S&P 500 dropped 1.4%, and the Nasdaq lost 1.7%.

All three main indexes are set for weekly declines despite the S&P 500 hitting record highs twice earlier this week.The blue-chip Dow was on pace for its worst weekly slide since early January.Data published by S&P Global showed US business activity nearly stalled in February amid mounting fears over tariffs on imports and deep cuts in federal government spending.“Companies report widespread concerns about the impact of federal government policies, ranging from spending cuts to tariffs and geopolitical developments,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.Another survey by the University of Michigan showed US consumer sentiment dropped more than expected in February to a 15-month low and inflation expectations rocketed.“There are signs that the economy might be slowing, and combine that with the fears of the unknown of the tariffs, it’s leading to somewhat of a pullback in the market,” said Peter Cardillo, chief market economist at Spartan Capital Securities.The Dow Jones Transport Average – often noted as gauge to measure the strength of the economy – slumped 2.4% and was on track for its worst single-day drop this year.UnitedHealth slid 9% after the Wall Street Journal reported that the Justice Department has launched an investigation into the company’s Medicare billing practices in recent months.Shares of other health insurers were also hit, with CVS Health down 2.3% and Humana losing 4.6%.Retail giant Walmart’s dour forecast on Thursday, along with jitters around President Tr...