REFILE-US STOCKS-Wall Street falls as U.S. virus cases pass 85,000

(Refiles to remove bullet point showing previous index moves)
* U.S. House approves $2 trillion aid package
* March consumer sentiment drops to 3-1/2-year low
* Banks stocks fall, tracking Treasury yields
* Boeing set to snap four-day stellar rally
* Indexes: Dow -2.60%, S&P 500 -2.20%, Nasdaq -2.24%

By Noel Randewich
March 27 (Reuters) - Wall Street fell on Friday, ending a
massive three-day surge as doubts about the fate of the U.S.
economy resurfaced and the number of coronavirus cases in the
country climbed.
U.S. stock indexes trimmed deeper losses after the House of
Representatives approved a $2.2 trillion aid package - the
largest in American history - to help people and companies cope
with an economic downturn caused by the coronavirus outbreak and
provide hospitals with urgently needed medical supplies.
The United States has surpassed China and Italy as the
country with the most coronavirus cases. The number of U.S.
cases passed 85,000, and the death toll exceeded 1,200.
"We have still not fully understood the degree of the
economic impact," warned Massud Ghaussy, senior analyst at
Nasdaq IR Intelligence in New York.
"Currently, from a policymaker's perspective, it's a
relative balance between managing the spread of the virus and
opening the economy."
President Donald Trump is expected to promptly sign the
stimulus package into law.
The bill, along with unprecedented policy easing by the
Federal Reserve, have put the S&P 500 .SPX on course for its
best week in more than a decade. However, it is still down about
24% from its February high.
In its strongest three-day performance since 1931, the Dow
surged 21% from Monday through Thursday, establishing it in a
bull market, according to one widely used definition. However,
many investors believe there is a strong risk the market could
fall deeply again as coronavirus infections increase and more
people die. "Next week will depend on what happens over the weekend,"
said Lindsey Bell, Chief Investment Strategist at Ally Invest.
"If there is a major acceleration over the weekend of
coronavirus cases in New York and other states and the hospital
system continues to get jammed up, then I think it will be a
rough week for the market."
Macroeconomic indicators offered a glimpse of the economic
devastation from the crisis as the lockdown of major cities
upends the lives of millions of Americans.
U.S. consumer sentiment dropped to a near 3-1/2-year low in
March, according to a survey released on Friday, a day after
data showed a record 3 million surge in jobless claims last
week. At 2:24 pm ET, the Dow Jones Industrial Average .DJI was
down 2.6% at 21,966.31 points, while the S&P 500 .SPX lost
2.20% to 2,572.23.
The Nasdaq Composite .IXIC dropped 2.24% to 7,622.94.
Delta Airlines DAL.N American Airlines AAL.O and United
Airlines UAL.O fell between 3% and 7% as U.S. Treasury
Secretary Steve Mnuchin said the aid designated for airlines in
the package was not a bailout and that taxpayers would need to
be compensated. Boeing BA.N shed 8%, but was still up more than 70% for
the week, after Mnuchin said the planemaker had no intention of
using federal money.
The banking index .SPXBK fell about 4%, tracking U.S.
Treasury yields as investors sought safety in high-quality
assets.
The energy index .SPNY was the biggest percentage loser
among the 11 major S&P sectors, sliding 5.5%, following a drop
in oil prices.
Declining issues outnumbered advancing ones on the NYSE by a
3.38-to-1 ratio; on Nasdaq, a 2.72-to-1 ratio favored decliners.
The S&P 500 posted no new 52-week highs and 1 new lows; the
Nasdaq Composite recorded 8 new highs and 28 new lows.