US Stocks See Hefty Selling, NASDAQ Tests Three Month Low

US stocks fell sharply Tuesday as government bond yields hit Covid-era highs and after Goldman Sachs reported disappointing earnings. The major averages tanked as government bond yields hit Covid-era highs amid high uncertainty ahead of the next week's US Fed monetary policy meeting. The Dow Jones Industrial Average slid 1.5%, to close at 35,368.47. The S&P 500 fell 1.8% to 4,577.11, and the Nasdaq Composite tanked 2.6% to 14,506.90, hitting its lowest level in three months. The Nasdaq is down more than 7% this year so far. The US markets were closed Monday due to the Martin Luther King Jr. holiday.

Economic cues were tepid too. The US builders in the single-family housing market are facing growing expenses, which is causing a turnaround in sentiment to start the year. Builder confidence fell one point to 83 in January, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). Anything above 50 is considered positive, but that is the first drop in four months. The index also stood at 83 in January 2021.

Broad worries over Covid-19 stay in place. On an average, more than 750,000 new Covid-19 infections were reported every day over the past week, according to Johns Hopkins University data.

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