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US health insurers drop after Medicare rates disappoint

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Tesla slides after Q1 deliveries miss

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Calvin Klein-parent PVH down after dour FY revenue

forecast

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Indexes down: Dow 1.19%, S&P 1.00%, Nasdaq 1.32%

(Updated at 11:56 a.m. ET/ 1556 GMT)

By Sruthi Shankar and Shashwat Chauhan

April 2 (Reuters) - Wall Street's main indexes dropped

on Tuesday, dragged down by rising Treasury yields and Tesla, as

recent strong economic data fueled uncertainty about the timing

of interest rate cuts from the Federal Reserve.

Shares of rate-sensitive growth stocks including Nvidia ( NVDA )

, Microsoft ( MSFT ) and Amazon.com ( AMZN ) fell 0.7% -

1.4% as the U.S. Treasury 10-year yield rose to

4.365%, its highest this year.

Tesla also tumbled 5.0% after the automaker missed

market expectations for first-quarter deliveries.

The Dow and S&P 500 closed lower on Monday

after stronger-than-expected manufacturing data from the

Institute for Supply Management (ISM) raised doubts over the

Fed's three interest rate cuts it had outlined at the last

policy meeting.

"ISM creeped above 50 for the first time in 17 months and

that should be a good thing, it shows resiliency of the U.S.

economy," said Hugh Anderson, managing director at HighTower

Advisors in Las Vegas, but since it diminishes hopes of rate

cuts in June, "the market is taking it in a negative fashion."

"Right now, the fundamentals are supportive of rates staying

where they are and possibly even nudging higher."

The CBOE Volatility index, also known as Wall

Street's 'fear gauge', touched an over two-week high.

Data on Tuesday showed new orders for U.S.-manufactured

goods rebounded more than expected in February, while U.S. job

openings held steady at higher levels.

Now the focus is on Friday's U.S. non-farm payrolls data,

which is likely to show job additions slowed in March although

average earnings ticked higher compared to the previous month.

Traders are pricing in a near 57% chance of the Fed cutting

interest rates by at least 25 basis points in June, down from

64% just a week ago, as per CMEGroup's FedWatch tool.

A slew of Fed officials including New York Fed President

John Williams, Cleveland Fed President Loretta Mester and San

Francisco President Mary Daly are scheduled to speak later in

the day.

Shares of UnitedHealth ( UNH ), CVS Health ( CVS ) and

Humana fell between 7.5% and 14.1% as the U.S.

government kept reimbursement rates for providers of Medicare

Advantage health plans unchanged, in a setback to insurers.

At 11:56 a.m. ET, the Dow Jones Industrial Average

was down 469.83 points, or 1.19%, at 39,097.02, the S&P 500

was down 52.53 points, or 1.00%, at 5,191.24, and the

Nasdaq Composite was down 216.89 points, or 1.32%, at

16,179.95.

Nine of the 11 major S&P 500 sectors were trading lower,

with the health care index, down 1.9%, on track for its

biggest percentage drop of the year.

Calvin Klein-parent PVH Corp's shares tumbled 23.3%

after the retailer forecast an about 11% drop in first-quarter

revenue. Peer Ralph Lauren dropped 5.1%.

Cryptocurrency and blockchain-related stocks dropped,

tracking an over 6% fall in bitcoin. Exchange operator

Coinbase, bitcoin investor MicroStrategy ( MSTR ) and

crypto miner Riot Platforms ( RIOT ) fell between 3.5% and 8.0%.

Declining issues outnumbered advancers for a 3.77-to-1 ratio

on the NYSE and for a 3.40-to-1 ratio on the Nasdaq.

The S&P index recorded 22 new 52-week highs and 3 new lows,

while the Nasdaq recorded 39 new highs and 93 new lows.

(Reporting by Sruthi Shankar and Shashwat Chauhan in Bengaluru;

Editing by Shinjini Ganguli)