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By Patti Domm, CNBC

For the first time since the election, markets are doubting they will get the pro-growth policies of tax reform and stimulus promised by President Donald Trump and the Republican Congress.

The repeal of Obamacare appears to have hit some snags and the GOP brought out Trump earlier Tuesday to serve as pitchman to House Republicans who may have been wavering ahead of Thursday's vote. Whether he won votes or not is unclear, but markets certainly took the lack of clear majority support as a negative.

The stock market sold off sharply all day Tuesday, with many market leaders of the Trump trade lagging. The Dow was down as much as 200 points, with investors snapping up bonds as fast as they could sell stocks.

The Dow is up 13 percent since Election Day, but some analysts say the market has been ignoring how the stimulus and tax reform promised by Trump would be paid for.

"Now people are beginning to realize there's potentially other issues,"Peter Boockvar, chief market analyst at The Lindsey Group, told CNBC.

The possibility of health-care reform becoming a quagmire has been a concern for markets for weeks, but there had not been a clear move in response to that concern since stocks started going higher right after the election.

Trump administration officials have promised that after the health-care act, tax reform would be up next on the agenda, and there was hope there would be movement on it by August.

Earlier Tuesday, Bank of America Merrill Lynch released its monthly fund managers survey, with a record number saying the market is extremely overvalued, and just 10 percent expecting to see U.S. tax reform passed by Congress before its August recess, as promised by the administration.

"Policy is the key catalyst for the Icarus trade to fly higher in the coming months," said Michael Hartnett, Bank of America Merrill Lynch's chief investment strategist.