Dow Drops 800 After Bonds Flash Warning
Aug 14, 2019, 2:42 PM | Updated: Jun 8, 2022, 5:03 pm
NEW YORK, NY - JANUARY 25: Pedestrians walk outside of the New York Stock Exchange (NYSE) after the Dow Jones industrial average crossed the 20,000 mark for the first time on January 25, 2017 in New York City. Solid earnings from major companies, including Boeing, led the morning rally. (Photo by Spencer Platt/Getty Images)
(Photo by Spencer Platt/Getty Images)
NEW YORK (AP) — The latest on developments in financial markets (all times local):
4 p.m.
The Dow Jones Industrial Average sank 800 points after the bond market flashed a warning sign about a possible recession for the first time since 2007.
The yield on the 10-year Treasury briefly dropped below the two-year yield Wednesday, an ominous signal that has predicted past recessions.
Investors have been plowing money into long-term U.S. government bonds for months, sending yields sharply lower, as they anticipate slower economic growth.
Macy’s plunged 13% after slashing its full-year profit forecast.
The Dow Jones Industrial Average fell 800 points, or 3%, to 25,479.
The S&P 500 lost 85 points, or 2.9%, to 2,840. The Nasdaq lost 242 points, or 3%, 7,773.
Bond prices soared. The yield on the 10-year Treasury sank to 1.58% from 1.68% Tuesday, a big move.
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11:45 a.m.
Stocks are falling sharply after the bond market threw up another warning flag on the economy.
The yield on the 10-year Treasury briefly dropped below the two-year Treasury’s yield Wednesday morning for the first time since 2007. That’s an ominous signal that has correctly predicted many past recessions.
Investors dumped stocks, more than erasing gains from a rally the day before.
Retailers came under especially heavy selling pressure after Macy’s issued a dismal earnings report.
The Dow Jones Industrial Average fell 616 points, or 2.3%, to 25,659.
The S&P 500 lost 68 points, or 2.3%, to 2,857. The Nasdaq lost 218 points, or 2.7%, 7,800.
U.S. government bond prices continued to soar as investors sought safety. The yield on the 10-year Treasury note sank to 1.59% from 1.68% Tuesday.
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9:43 a.m.
Stocks are opening sharply lower on Wall Street following big losses in Europe after German’s economy shrank in the second quarter and as the U.S. bond market flashed a warning about a possible recession.
The Dow Jones Industrial Average was down as much as 400 points early Wednesday.
U.S. government bond prices continued to soar as investors sought safety, briefly pushing a key yield below a threshold that has correctly predicted recessions in the past.
The Dow fell 388 points, or 1.5%, to 25,894.
The S&P 500 lost 39 points, or 1.3%, to 2,887. The Nasdaq lost 1.5% to 7,894.
The yield on 10-year Treasury briefly fell below the yield on the 2-year note, which has correctly predicted previous U.S. recessions.
