(For a Reuters live blog on U.S., UK and European stock

markets, click/ or type LIVE/ in a news window.)

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Moderna ( MRNA ) slides after cutting 2025 sales forecast

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Chip stocks fall as US tightens grip on AI chip flows

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Health insurers rise after US proposes 2026 payment rates

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Nasdaq hits more than one-month low

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Indexes: Dow up 0.25%, S&P 500 slips 0.70%, Nasdaq off

1.43%

(Updates for markets open)

By Johann M Cherian and Sukriti Gupta

Jan 13 (Reuters) -

U.S. stocks dropped on Monday, with the benchmark S&P 500 at

a two-month low as bond yields surged after robust payroll

numbers last week, boosting expectations that the Federal

Reserve will maintain a hawkish stance for most of this year.

At 09:50 a.m. the Dow Jones Industrial Average rose

105.06 points, or 0.25%, to 42,043.51, the S&P 500 lost

40.79 points, or 0.70%, to 5,786.25, and the Nasdaq Composite

lost 274.13 points, or 1.43%, to 18,887.50.

Wall Street's fear gauge rose 1.60 points to hit

a more than three-week high.

The domestically sensitive Russell 2000 index

declined 1% to its lowest since September 2024, extending

Friday's decline, which saw it enter correction territory after

falling more than 10% from its November intraday record high.

Pressuring stocks, yields on longer-dated Treasury bonds

are pinned at multi-month highs.

At one point, traders were no longer fully pricing in

even one Fed rate cut this year, according to

data compiled by LSEG

, from about 43 basis points before Friday's job figures.

Bets currently reflect expectations of a 27 bps easing by the

Fed's December meeting.

"In the early stages of recalibrating monetary policy,

investors tend to take a bit of a risk-off attitude," said Art

Hogan, chief market strategist at B Riley Wealth.

"But the important part of what has changed thus far

this year is that economic data being positive at the end of the

day will likely be a net positive for corporate earnings and for

markets."

Five of the 11 S&P 500 sectors declined, led by a 1.8%

drop in Technology stocks. Megacaps were down, with

Tesla sliding 2%, Apple ( AAPL ) dropping 2.7% and

Alphabet losing 1.5%.

The main indexes logged their second consecutive week of

declines in the previous session after multiple reports pointed

to better-than-expected economic activity, raising worries that

inflation could be running high.

Investors also priced in the likelihood that the incoming

Donald Trump administration's policies - such as tariffs and a

clampdown on illegal immigration - could threaten global trade

and fuel price pressures when the Fed has also signaled a cloudy

monetary policy outlook. Trump is expected to take office on

Jan. 20.

The Consumer Price Index numbers and the central bank's

Beige Book on economic activity, both due on Wednesday, could

help investors gauge the Fed's policy outlook.

Chip stocks such as Nvidia ( NVDA ) dropped 3.3% and

Advanced Micro Devices ( AMD ) fell 1% after the U.S. government

said it would further restrict artificial-intelligence chip and

technology exports.

Moderna ( MRNA ) slid 22% to the bottom of the S&P 500 after

cutting its 2025 sales forecast by $1 billion.

Dow component UnitedHealth Group ( UNH ) added 3.6%, CVS

Health ( CVS ) rose 4.1% and Humana climbed 5.9% after

the U.S. government

proposed 2026 reimbursement rates

for Medicare Advantage plans run by private insurers, which

will result in a 2.2% increase in payments.

Major lenders JPMorgan Chase & Co ( JPM ) and Wells Fargo ( WFC )

are due to report results on Wednesday.

Declining issues outnumbered advancers by a 1.96-to-1 ratio

on the NYSE, and by a 2.57-to-1 ratio on the Nasdaq.

The S&P 500 posted one new 52-week high and 22 new lows,

while the Nasdaq Composite recorded 11 new highs and 149 new

lows.