* Indexes down: Dow 0.88%, S&P 500 0.99%, Nasdaq 1.45%

* US health insurers jump after Medicare Advantage

payment hike

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

(Updates after markets open)

By Purvi Agarwal and Avinash P

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

Tuesday as investors parsed comments from the U.S. and Iran for

any 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.

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, while Iran said it would no longer hold back from

hitting infrastructure of its Gulf neighbors.

It also warned that the Bab El-Mandeb waterway, another

critical chokepoint, could be closed if the situation goes out

of control. The comments come ahead of Trump's Tuesday deadline

to reopen the Strait of Hormuz, which Tehran showed no sign of

agreeing to.

"What you're seeing with the market reaction is an

acknowledgement that an end is not necessarily as close as

people had hoped," said Chris Zaccarelli, chief investment

officer for Northlight Asset Management.

"The conflict is more likely to continue with these attacks

or increasing rhetoric from both sides ... that puts traders

back in an uneasy position and expecting a more worse outcome in

terms of continuation."

In the market, tech stocks weighed heavily. The S&P 500

information technology index was down 1.7%, with Apple ( AAPL )

down 3.8%. The stock was the biggest drag on all three

indexes.

A 3% 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

1.8%.

However, a 7.7% jump in UnitedHealth ( UNH ) kept a lid on

declines on the Dow. Peers Humana gained 4.5% and CVS

Health ( CVS ) added 3.7%, 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.

At 10:08 a.m. ET, the Dow Jones Industrial Average

fell 408.87 points, or 0.88%, to 46,261.01, the S&P 500

lost 66.46 points, or 0.99%, to 6,546.61 and the Nasdaq

Composite lost 326.15 points, or 1.45%, to 21,677.16.

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 2.42-to-1 ratio

on the NYSE and by a 3.08-to-1 ratio on the Nasdaq.

The S&P 500 posted no new 52-week highs and four new lows,

while the Nasdaq Composite recorded 26 new highs and 63 new

lows.