Stocks moved from positive to negative territory on Thursday as concern insurers’ earnings will be hurt by President Barack Obama’s overhaul of the health-care system offset a rally in banks spurred by his request for more financial-bailout funds.

Health insurers UnitedHealth, Humana and Aetna declined more than 13% on concerns that Medicare payments to insurers will be reduced. Sallie Mae tumbled 36% after the president called for an end to its student loan subsidies.

The budget as outlined would stop the “waste” in government payments to Humana and companies like it that provide special plans for the elderly. It would also squeeze discounts to drug makers who supply medicines to the poor.

Eli Lilly fell 3.1% after saying it would lose “several hundred million” dollars in annual sales if Obama’s health-care plan is approved.

Merck, maker of asthma treatment Singulair, dropped 5.5%.

Class Warfare

Obama’s proposal also includes almost $1 trillion in higher taxes on the 2.6 million highest-earning Americans and companies to pay for permanent tax breaks for lower earners. It would reinstate the top two Clinton-era tax rates of 36% and 39.6% in 2011, up from the 33% and 35% the highest earners now pay. Taxes on capital gains and dividends for top earners would rise to 20% from 15%.

At Thursday's close of floor trading on the NYSE the DOW was on 7179.06 with a loss of 91.83 points (-1.28%). The S&P finished on 752.44, down 12.46 points (-1.63%) after rising as much as 1.10% earlier. The technology-heavy NASDAQ closed on 1383.17 after falling 12.46 points (-2.26%).

The dollar traded in risk-acceptance mode, finishing the session with declines of 0.11% on the euro, 0.36% against Australia's dollar and 0.73% to sterling as it rose 0.99% on the yen.

Treasuries fell for a third day as the government sold $22 billion of seven-year notes in the last of three auctions this week as it issues an unprecedented amount of debt to spur the U.S. economy. Yield on the 2-year note rose 0.4 basis points to 1.089% while yield on the 10-year note gained 7.1 basis points to 3.00%.

Crude for March delivery was recently trading up $1.84 (4.33%) to $44.30 per barrel.

Gold for April delivery was recently trading lower by $19.80 (-2.05%) to $945.90 per ounce after reaching a high on $1004.90 last Friday.