US STOCKS-Wall St slides to seven-week low on new lockdown fears

* Shares of airlines and leisure companies tumble
* Big lenders fall on reports banks moved illicit funds
* Nikola crashes as founder resigns; GM shares fall
* Indexes down: Dow 3.06%, S&P 500 2.49%, Nasdaq 1.65%

(Adds market details, NEW YORK to dateline)
By Herbert Lash
NEW YORK, Sept 21 (Reuters) - Wall Street's main indexes
slid to seven-week lows on Monday, with the S&P 500 and Dow each
tumbling more than 2%, as concerns about fresh
coronavirus-driven lockdowns in Europe raised fears the U.S.
economy faces a longer road to recovery than expected.
The death of U.S. Supreme Court Justice Ruth Bader Ginsburg
increased the likelihood another stimulus package will not be
approved in Congress before the Nov. 3 presidential election and
sparked large declines in the healthcare sector.
The Dow shed as much as 900 points and the CBOE Market
Volatility index .VIX , Wall Street's fear gauge, shot up to
its highest level in nearly two weeks.
Ginsburg's death added to growing uncertainty about the
election outcome and health of the economy.
"It just kind of crowds out the agenda, the idea that we are
going to get a fiscal stimulus package before the election,"
said Ed Campbell, portfolio manager and managing director at QMA
in Newark, New Jersey.
"There is also just general election-related jitters ... and
possibly that we have a contested or delayed outcome."
Congress has for weeks remained deadlocked over the size and
shape of a fifth coronavirus-response bill, on top of the
roughly $3 trillion already enacted into law. Healthcare providers came under pressure on uncertainty over
the fate of the Affordable Care Act (ACA), better known as
Obamacare, with shares of Universal Health Services UHS.N
falling more than 11%.
Ginsburg's death could lead to a tie vote when the Supreme
Court hears a challenge to the constitutionality of ACA in
November, Mizuho, Stephens Inc and other financial services
firms said.
Wall Street has tumbled in the past three weeks as investors
dumped heavyweight technology-related stocks following a
stunning rally that lifted the S&P 500 and the Nasdaq to new
highs after plunging in March as economies entered recession.
Another round of business restrictions will threaten a
nascent recovery in the wider economy and add further pressure
on equity markets, analysts said. The first round of lockdowns
in March had led the S&P 500 .SPX to suffer its worst monthly
decline since the global financial crisis. US/
In contrast to last week's trend, declines were led by
value-oriented sectors such as industrials .SPLRCI , energy
.SPNY and financials .SPSY as opposed to technology stocks
.SPLRCT . Financials were poised to notch their worst day since
June 26.
Airline, hotel and cruise companies tracked declines in
their European peers as the UK signalled the possibility of a
second national lockdown. Europe's travel and leisure index
.SXTP marked its worst two-day drop since April. .EU
The largest gainer among the Nasdaq 100 was Zoom Video
Communications Inc ZM.OQ , which rose 6.2% on the prospect that
fresh lockdowns would spur greater use of the product.
In late afternoon, the Dow Jones Industrial Average .DJI
was down 847.22 points, or 3.06%, at 26,810.2, the S&P 500
.SPX lost 82.75 points, or 2.49%, to 3,236.72 and the Nasdaq
Composite .IXIC dropped 178.22 points, or 1.65%, to 10,615.06.
JPMorgan Chase & Co JPM.N and Bank of New York Mellon Corp
BK.N fell 3.82% and 4.71%, respectively, on reports that
several global banks moved large sums of allegedly illicit funds
over nearly two decades despite red flags about the origins of
the money. The S&P banking subindex .SPXBK lost 4.3%.
Nikola Corp NKLA.O plunged 20.2% after its founder, Trevor
Milton, stepped down as executive chairman following a public
squabble with a short-seller over allegations of nepotism and
fraud. General Motors Co GM.N , which recently said it would take
an 11% stake in the electric truck maker, slipped 5.5%.
Declining issues outnumbered advancing ones on the NYSE by a
8.67-to-1 ratio; on the Nasdaq, a 5.60-to-1 ratio favored
decliners.