S&P 500 slides, bond yields fall on slowdown worries

By Caroline Valetkevitch NEW YORK (Reuters) - The S&P 500 and Nasdaq fell on Wednesday as U.S. bond yields fell again and a prolonged inversion in the yield curve fanned growth worries. Benchmark 10-year Treasury yields slid on Wednesday, but came off 15-month lows reached overnight as investors remained focused on central bank dovishness globally.

Reuters March 28, 2019 02:05:47 IST
S&P 500 slides, bond yields fall on slowdown worries

SP 500 slides bond yields fall on slowdown worries

By Caroline Valetkevitch

NEW YORK (Reuters) - The S&P 500 and Nasdaq fell on Wednesday as U.S. bond yields fell again and a prolonged inversion in the yield curve fanned growth worries.

Benchmark 10-year Treasury yields slid on Wednesday, but came off 15-month lows reached overnight as investors remained focused on central bank dovishness globally.

The yield curve inverted for the first time since 2007 on Friday and if the inversion continues to persist it could indicate that a recession is likely in one to two years.

Interest-rate sensitive financial stocks were down, with the S&P 500 financial index falling 0.3 percent.

"The inverted yield curve, that's what worries investors and it's why you're getting selling here. It's definitely a slowing economy indicator, and whether it goes into a recession or not, nobody really knows. But it will put a pause in the market," said Alan Lancz, president, Alan B. Lancz & Associates Inc, an investment advisory firm, based in Toledo, Ohio.

Investors have been fretting about slowing economic growth since last week after the Federal Reserve did a stunning about-turn on rate hikes and dour factory data from the United States, Europe and Japan.

The European Central Bank became the latest central bank to delay a planned increase in rates amid rising threats to growth.

The Dow Jones Industrial Average rose 1.82 points, or 0.01 percent, to 25,659.55, the S&P 500 lost 8.36 points, or 0.30 percent, to 2,810.1 and the Nasdaq Composite dropped 37.73 points, or 0.49 percent, to 7,653.80.

Not all data was bleak. A Commerce Department report showed that U.S. trade deficit dropped more than expected in January, likely as Chinese purchases of soybeans spurred a rebound in exports after three straight monthly declines.

Lennar Corp rose 3.1 percent as the No.2 U.S. homebuilder said it expected the housing market to improve, while shares of KB Home, which reported upbeat results late Tuesday, were up 1.7 percent.

Also helping was a survey that showed mortgage applications in the week ended March 22 rose nearly 9 percent amid lower interest rates, according to the Mortgage Bankers Association.

Centene Corp's shares fell 6.2 percent after the health insurer said it would buy smaller rival WellCare Health Plans Inc for $15.27 billion. Shares of WellCare jumped 11 percent.

Declining issues outnumbered advancing ones on the NYSE by a 1.23-to-1 ratio; on Nasdaq, a 1.45-to-1 ratio favoured decliners.

The S&P 500 posted 29 new 52-week highs and 6 new lows; the Nasdaq Composite recorded 26 new highs and 60 new lows.

(Reporting by Caroline Valetkevitch; Editing by Phil Berlowitz)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.