Dow and broader U.S. stock market turned lower in afternoon trading on Tuesday,
as demand for haven investments continued to rise in the face of renewed China
Dow Turns Lower; S&P 500, Nasdaq Follow
All of Wall Street’s major indexes pivoted lower in the afternoon session, diverging from a solid pre-market for Dow futures. After rising by as much as 152 points, the Dow Jones Industrial Average eventually fell 120.93 points, or 0.5%, to 25,777.90.
The broad S&P 500 Index of large-cap stocks slipped 0.3% to 2,869.16, with losses concentrated in eight of 11 sectors. Financials stocks lost 0.7% to lead the market lower.
The technology-focused Nasdaq Composite Index edged down 0.3% to close at 7,826.95.
Key Yield Curve Remains Inverted
and U.S. Treasurys advanced on Tuesday, as demand for haven assets continued to
rise in the wake of renewed U.S.-China trade tensions.
Rising bond prices pushed the benchmark 10-year U.S. Treasury yield back below 1.5%. By comparison, the yield on the 2-year Treasury note is around 1.52%.
This so-called inverted yield curve, which materialized earlier this month for the first time in over a decade, is a strong recession signal for the bond markets.
When the yield curve inverts, a recession usually follows 22 months later – at least, that’s been the case the last five times the 2-year yield has risen above the 10-year yield.
The U.S. economy is projected to grow 2.3% annually in the third quarter, according to the Atlanta Fed’s GDP tracker.