* Indexes: Dow, S&P 500 down 0.92% each, Nasdaq down

1.25%

* US health insurers jump after Medicare Advantage

payment hike

* Apple ( AAPL ) drops after report foldable phones facing

setbacks

* Broadcom ( AVGO ) rises on deal to develop Google's AI chips

(Updates with late-morning prices)

By Purvi Agarwal and Avinash P

April 7 (Reuters) - Wall Street's main indexes fell on

Tuesday as investors scrutinized developments for clues on what

might come next in the Middle East conflict, before President

Donald Trump's deadline for Iran to reopen the Strait of Hormuz.

Trump threatened that "a whole civilization will die

tonight" as Iran showed no sign of accepting his ultimatum to

open the Strait of Hormuz by Tuesday evening, Washington time.

The Wall Street Journal reported that Iran had cut off

direct diplomacy with the U.S., but state-run newspaper Tehran

Times said on X that channels of talks were not closed.

A U.S. official told Reuters that the country had struck

military targets on Iran's Kharg Island, a hub of Iran's oil

exports, in signs that the conflict would not end swiftly.

"Considering the rhetoric that's coming from President

Trump, the markets are nervous but they're not collapsing ...

we're not seeing any signs of panic," said Peter Cardillo, chief

market economist at Spartan Capital Securities.

"It's a question ... markets are waiting to see what the

final result of Trump's threats will be."

Tech stocks weighed heavily, with the S&P 500 information

technology index down 1.4%. Apple ( AAPL ) lost 4.2%

after a report said its foldable phone has been encountering

setbacks in its engineering test phase, which could lead to

production delays. The stock was the biggest drag on all three

indexes.

A 3.7% gain in Broadcom ( AVGO ) after the chipmaker signed

a long-term deal with Alphabet's Google to develop its

AI chips and other components helped limit declines.

On the flip side, energy stocks on the S&P 500 added

1%.

At 11:48 a.m. ET, the Dow Jones Industrial Average

fell 428.65 points, or 0.92%, to 46,241.23, the S&P 500

lost 60.97 points, or 0.92%, to 6,550.76 and the Nasdaq

Composite lost 274.02 points, or 1.25%, to 21,722.32.

Meanwhile, UnitedHealth ( UNH ) jumped 8.8% and peers Humana

and CVS Health ( CVS ) added 6.5% and 6.7%,

respectively, after the U.S. said on Monday it would raise

payments to private insurers offering Medicare Advantage plans

to older adults, an increase from the near-flat change proposed

earlier.

Wall Street's main indexes closed higher on Monday, marking

the fourth consecutive session of gains for the S&P 500 and the

Nasdaq, as investors digested the Middle East developments and

positioned for the upcoming quarterly earnings season.

This week, markets will scrutinize some inflation readings

to see if the elevated crude prices stemming from the conflict

have impacted price pressures in the economy.

The Iran war has complicated the interest rate outlook for

the Federal Reserve as it grapples with fears of revived

inflation against the backdrop of a resilient labor market.

Comments from Fed policymakers Austan Goolsbee, Philip

Jefferson and Mary Daly will be parsed throughout the day for

clues on the future policy path.

Among other movers, Intel ( INTC ) shares added 2.2% after

the chipmaker said it would join Elon Musk's Terafab AI chip

complex project along with SpaceX, Tesla and xAI.

Declining issues outnumbered advancers by a 2.49-to-1 ratio

on the NYSE and by a 2.72-to-1 ratio on the Nasdaq.

The S&P 500 posted two new 52-week highs and five new lows,

while the Nasdaq Composite recorded 33 new highs and 97 new

lows.