US STOCKS-Wall Street gripped by fears of fresh virus wave

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* All S&P sectors trading in the red
* Moderna up on report Israel in talks to buy its vaccine
* S&P 500 drops below key 200-day moving average
* Indexes down: Dow 1.07%, S&P 0.74%, Nasdaq 0.23%

(Adds quote, details; updates prices)
By Devik Jain and Medha Singh
June 15 (Reuters) - U.S. stocks dropped on Monday after a
spike in new coronavirus cases in China and parts of the United
States dampened hopes of a swift economic recovery that had
driven a sharp rise in Wall Street's main indexes over the past
month.
Battered shares of U.S. airlines, casino operators and
cruise operators slipped after attempting a rebound in recent
weeks. Norwegian Cruise Line Holdings Ltd NCLH.N and Wynn
Resorts WYNN.O fell 5.4% and 1.9%. The S&P 1500 airlines
.SPCOMAIR lost 2.8%.
Beijing reinstated curbs after an unexpected spike in cases,
while the United States saw a record number of new infections
and hospitalizations in more states, including Florida and
Texas. The CBOE volatility index .VIX , a gauge of investor
anxiety, eased after hitting its highest level since April 22.
"When we see a pullback like today, it's just the enthusiasm
dying down a little bit and people waiting to get a better
understanding on this increase in infection rates," Anthony
Denier, chief executive officer of online broker Webull
Financial LLC in New York.
Trillions of dollars in fiscal and monetary stimulus along
with easing of restrictions had lifted the S&P 500 earlier last
week as much as 47.5% from the pandemic low in March and helped
the tech-heavy Nasdaq confirm a bull market.
But, a dismal economic outlook from the U.S. Federal Reserve
and jitters over a resurgence in coronavirus cases sent the Wall
Street's main indexes for their worst week since March.
"The selloff since last week's high is a reminder that we
are not out of the woods yet. We expect a range-bound, choppy
market for some time," said David Bahnsen, chief investment
officer, The Bahnsen Group, based in Newport Beach, California.
The S&P 500 index .SPX opened below its closely watched
200-day moving average of 3,014.41 points. It is also flirting
with the psychologically important level of 3,000 points.
The benchmark index fell as much as 2.5% in early trading.
At 11:15 a.m. ET, the Dow Jones Industrial Average .DJI
was down 274.09 points, or 1.07%, at 25,331.45, the S&P 500
.SPX was down 22.58 points, or 0.74%, at 3,018.73. The Nasdaq
Composite .IXIC was down 21.99 points, or 0.23%, at 9,566.82.
All major S&P sectors were lower with the
economically-sensitive energy .SPNY and healthcare .SPXHC
posting the biggest percentage declines.
Beginning Tuesday, investors will focus on Fed Chair Jerome
Powell's two-day congressional testimony on the monetary policy
report.
United Airlines UAL.O said it is pledging its MileagePlus
frequent flyer program for a new $5 billion loan aimed at
further buffering its liquidity, even as its cash burn rate
slows thanks to a steady improvement in demand. Moderna Inc MRNA.O rose 3.1% after a report said Israel is
in advanced talks with the drug developer to buy its coronavirus
vaccine. Declining issues outnumbered advancers for a 2.33-to-1 ratio
on the NYSE and for a 1.30-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and no new low,
while the Nasdaq recorded 27 new highs and 10 new lows.

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