Hefty losses in health care and technology companies led US stocks sharply lower Tuesday, handing the market its biggest pullback since August and its worst two-day drop since May.
The broad slide, which briefly sent the Dow Jones industrial average down by more than 400 points, erased some of the big gains the market had racked up since the beginning of the year, though the market was still on track to close out January with a gain.
Bank, industrial, and energy stocks also accounted for a big slice of the losses.
Bond prices fell, sending yields to their highest level since April 2014.
‘‘This was a market that was overbought and it was vulnerable to something pulling it back,’’ said Quincy Krosby, chief market strategist at Prudential Financial. ‘‘That said, we’re in the heaviest part of earnings season this week and we expect to see the majority of the reports coming out to be positive. That could be the catalyst to have buyers come in.’’
The Standard & Poor’s 500 index fell 31.10 points, or 1.1 percent, to 2,822.43. That’s the biggest one-day drop since August 17.
The Dow had its biggest decline since May, losing 362.59 points, or 1.4 percent, to 26,076.89. The average had been down more than 411 points.
The Nasdaq slumped 64.02 points, or 0.9 percent, to 7,402.48.
The Russell 2000 index of smaller-company stocks gave up 15.29 points, or 1 percent, to 1,582.82.
The market’s last two-day losing streak was in late December.
Health care companies were by far the biggest losers. The sector finished with a loss of 2.1 percent. But it’s still up 8.1 percent this year.
Insurers and drug makers and distributors slumped following news that Amazon was teaming up with JPMorgan Chase and Berkshire Hathaway to create a company to help their US employees find quality care at a reasonable cost. The venture, whose initial focus would be on developing technology, is in its early planning stage.
Express Scripts slid 3.2 percent, Cigna tumbled 7.2 percent, UnitedHealth Group lost 4.3 percent, and Anthem fell 5.3 percent.
HCA bucked the trend after the hospital chain posted better fourth-quarter results than expected. The stock gained 3.9 percent.
Amazon’s stock added 1.4 percent.
Technology stocks fell almost as much as health care shares. Corning lost 5.6 percent.
Bond prices continued to decline, driving up the yield on the 10-year Treasury to 2.72 percent from 2.70 percent late Monday. That’s the highest the rate has been since April 2014. The yield was as low as 2.04 percent last September.
Bond yields have been rising steadily for months, making bonds more appealing to investors seeking income. Rising yields can also lead to higher financing costs for companies, home buyers, and other borrowers.
The market sell-off comes during a week with no shortage of potential market-moving corporate news and economic data.
Several big-name companies are due to report quarterly results Wednesday and Thursday, including Apple, Amazon, Microsoft, Facebook, and Alphabet.
Also on the radar: a two-day meeting of the Federal Reserve’s policy committee that wraps up Wednesday. The Fed has signaled it expects to raise its key short-term interest rate three times this year. But some investors speculate the growing strength of the US economy and labor market could prompt the central bank to forecast an extra rate increase this year.
Energy sector stocks declined along with the price of crude oil. Benchmark US crude slid $1.06, or 1.6 percent, to $64.50 a barrel in New York. Brent crude, used to price international oils, dropped 44 cents, or 0.6 percent, to $69.02 in London.
Major indexes in Europe declined amid investor worries that new data showing the eurozone grew in 2017 at its fastest pace in a decade could prompt the European Central Bank to wind down its monetary stimulus program earlier than expected.
The DAX in Germany lost 1 percent, while the CAC 40 in France fell 0.9 percent. Britain’s FTSE 100 gave up 1.1 percent.
Key indexes in Asia also closed lower. Japan’s Nikkei 225 index lost 1.4 percent, while Hong Kong’s Hang Seng dropped 1.1 percent. South Korea’s Kospi sank 1.2 percent.