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Wall St. drops as Treasury yields surge

Reuters 

By Stephen Culp

(Reuters) - A surge in bond yields to their highest level in almost seven years sent Wall Street shares sliding on Tuesday after strong data stoked inflation concerns and investors fretted about looming trade talks between the and

All three U.S. stock indexes closed down, with the ending a four-day winning streak and the posting its first loss in eight sessions.

The yield on 10-year notes jumped to its highest level since July 2011, suggesting an uptick in inflation and sending the dollar index <.DXY> to its highest close in 2018, raising expectations for further interest rate hikes from the Federal Reserve.

"A combination of firm growth and higher interest rates is unnerving," said Anthony Chan, for Chase in "A stronger dollar means downward pressure. ... A creeping up of these things continues to keep the market nervous."

Core April - which excludes gasoline, automobiles, building materials and - rose at a brisker 0.4 percent monthly pace over March, as consumer spending is quickening its pace after a first-quarter slowdown.

Investors also remain preoccupied by the run-up to high-level talks between and the set to commence this week in U.S. to said the two countries remain "very far apart" regarding a tariff resolution, after which told he supports efforts to reach an agreement.

"A little bit of today's jitters are related to a hangover to yesterday's wrongly placed exuberance that a trade deal was imminent, and the reality is we are in for a long slugfest between the U.S. and China," said Jon Mackay, at North America in

The <.DJI> fell 193 points, or 0.78 percent, to 24,706.41, the <.SPX> lost 18.68 points, or 0.68 percent, to 2,711.45 and the Composite <.IXIC> dropped 59.69 points, or 0.81 percent, to 7,351.63.

The losses were broad-based, with all 11 S&P sectors except closing down. Real estate <.SPLRCR>, and posted the biggest percentage losses.

shares slipped 1.6 percent after the home missed sales forecasts as the long winter put a damper on demand for spring products. Smaller rival was down 1.0 percent.

Declining issues outnumbered advancing ones on the NYSE by a 1.87-to-1 ratio; on Nasdaq, a 1.14-to-1 ratio favored decliners.

The posted 10 new 52-week highs and seven new lows; the Composite recorded 82 new highs and 51 new lows.

Volume on U.S. exchanges was 6.60 billion shares, compared with the 6.67 billion-share average for the full session over the last 20 trading days.

(Reporting by Stephen Culp; additional reporting by Lewis Krauskopf; editing by Jonathan Oatis)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, May 16 2018. 03:35 IST
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