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* Morgan Stanley profit beats on wealth management strength

* United Airlines down after lower Q4 profit forecast

* Indexes down: Dow 0.7%, S&P 500 1%, Nasdaq 1.3%

NEW YORK, Oct 18 (Reuters) - U.S. stocks were lower in afternoon trading on Wednesday as Treasury yields rose again and investors assessed the latest batch of quarterly results from companies.

Also, growing tensions in the Middle East dented risk sentiment, with gold prices among the day's gainers.

Yields edged higher after a sharp rebound in U.S. homebuilding, which underpinned the view that the Federal Reserve will keep interest rates higher for longer.

"We're in a period of sector rotation, and people are trying to figure out in this new environment - in a full reset of rates across the curve - what are the stocks that are going to continue to do well and what are the stocks that are going to suffer," said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

"Obviously, companies that are highly leveraged have difficulties in this kind of a market, and there probably is a reset in terms of market multiple on some of the big growth names."

Higher yields also make stocks less attractive to investors seeking high income and low risk.

On the earnings front, Procter & Gamble shares gained after its quarterly sales topped market expectations, while United Airlines Holdings shares were down after it forecast weaker fourth-quarter profit due to higher costs. The S&P 500 passenger airlines index also dropped.

The Dow Jones Industrial Average fell 223.62 points, or 0.66%, to 33,774.03, the S&P 500 lost 44.88 points, or 1.03%, to 4,328.32 and the Nasdaq Composite dropped 172.51 points, or 1.27%, to 13,361.24.

U.S. President Joe Biden pledged solidarity with Israel, at what became the only stop of a Middle East mission derailed by a massive explosion at a Gaza hospital, which Biden said appeared to have been caused by Israel's foes.

Also in earnings news, Morgan Stanley's third-quarter profit dropped less than expected as a strong performance in its wealth management division offset a hit from a lull in dealmaking. But its shares fell sharply.

Investors awaited results from Tesla and Netflix due after the closing bell. Tesla and Netflix shares were lower.

Declining issues outnumbered advancing ones on the NYSE by a 3.94-to-1 ratio; on Nasdaq, a 2.87-to-1 ratio favored decliners.

The S&P 500 posted 12 new 52-week highs and 19 new lows; the Nasdaq Composite recorded 22 new highs and 202 new lows. (Additional reporting by Ankika Biswas and Shashwat Chauhan in Bengaluru; additional reporting by Sruthi Shankar; editing by Arun Koyyur, Vinay Dwivedi and Nick Zieminski)