US STOCKS-Wall St edges lower as trade truce rally ebbs, UnitedHealth falls

By Shashwat Chauhan and Pranav Kashyap

May 15 (Reuters) - Wall Street dipped on Thursday as elation from the U.S.-China tariff truce faded for major indexes, while UnitedHealth's stock took a pummeling after a report of a DOJ fraud inquiry into the insurer.

UnitedHealth Group UNH.N plunged 16% to its lowest level since April 2020.

The Wall Street Journal reported that the U.S. Department of Justice was conducting a criminal investigation into the company for possible Medicare fraud. However, the health insurer said it had not been informed of a criminal probe by federal prosecutors.

Walmart WMT.N will have to start raising prices later this month due to the high cost of tariffs, executives said, even as the retail giant's U.S. comparable sales surpassed expectations in the first quarter. Its shares were down 4.8%

At 09:42 a.m., the Dow Jones Industrial Average .DJI fell 128.62 points, or 0.31%, to 41,922.44, the S&P 500 .SPX lost 19.46 points, or 0.33%, to 5,873.03, and the Nasdaq Composite .IXIC lost 123.27 points, or 0.64%, to 19,023.53.

Speaking on the day, U.S. Federal Reserve chair Jerome Powell said central bank officials felt they needed to reconsider the key elements around jobs as well as inflation in their current monetary policy approach.

U.S. retail sales growth slowed in April, while a Labor Department report showed the producer price index for final demand fell 0.5% for the same month, compared to an expectation of a 0.2% rise.

On an annual basis, producer prices came in at 2.4% versus an estimate of 2.5%.

"There will be a hump and pick up in prices, but until we see how big that is and how lasting that is, the Fed should be able to remain patient," said Jan Nevruzi, U.S. rates strategist at TD Securities.

The data dump follows a relatively tame consumer price reading earlier this week, indicating that consumer prices rebounded moderately last month.

In results-driven moves, Cisco Systems CSCO.O gained 2.9% after the networking-equipment maker raised its annual forecasts and named Mark Patterson its new CFO.

Only four out of the 11 S&P 500 sectors were trading in the green.

The energy sector .SPNY fell the most, as oil prices slid around 3% on expectations of a U.S.-Iran nuclear deal that could result in sanctions easing.

Stocks have been see-sawing this week as equities jumped on Monday and Tuesday following a temporary ceasefire in the U.S.-China tariff war. The gains were enough to drag the S&P .SPX out of the red for the year - its first positive showing since late February - although it is still about 4% shy of its record highs.

Many megacap and growth stocks pulled back, with Nvidia NVDA.O slipping 1.2%, while Tesla TSLA.O shed 2.8%.

Foot Locker FL.N, soared 83.6% after rival Dick's Sporting Goods DKS.N agreed to buy the footwear retailer for $2.4 billion.

Advancing issues outnumbered decliners by a 1.01-to-1 ratio on the NYSE, while declining issues outnumbered advancers by a 1.28-to-1 ratio on the Nasdaq.

The S&P 500 posted four new 52-week highs and three new lows, while the Nasdaq Composite recorded 17 new highs and 51 new lows.