U.S. Stocks, Treasury Yields Fall Further Amid Trade Jitters



Amrith Ramkumar | Wall Street Journal

Stocks around the world and commodities slid again Wednesday, as worries about slowing economic growth spurred a fresh retreat from riskier investments.

The Dow Jones Industrial Average fell 360 points, or 1.4%, to 24988. The S&P 500 dropped 1.1%, with each of its 11 sectors dropping. The broad equity gauge was on track for its lowest close since mid-March and was nearly 6% below its April 30 record. The tech-laden Nasdaq Composite declined 1.1%.

The yield on the benchmark 10-year U.S. Treasury note, which is tied to everything from mortgage rates to student debt, also extended a recent slide, dropping to 2.226%, according to Tradeweb, from 2.268% a day earlier. Tuesday’s close was its lowest settle since September 2017. Bond yields fall as prices rise and have dropped with investors seeking safety in Treasurys lately.

Fears that a drawn-out U.S.-China tariff dispute will add pressure on an already slowing world economy have rocked markets lately. President Trump indicated Monday that a near-term deal between the two sides is unlikely, and economic data pointing to weakness around the globe has added to growth concerns in recent days.

Reports in Chinese media outlets Wednesday that China could cut exports of rare-earth metals critical to everything from electronics and military equipment were the latest trigger for trade-related volatility, investors said.

“The industrial side of the world is still slowing, and that’s concerning,” said Paul Zemsky, chief investment officer of multiasset strategies and solutions at Voya Investment Management. “While I think the U.S. will continue to plow through, the rest of the world becomes more questionable.”

Mr. Zemsky said the firm has lowered the total amount of risk in its portfolios in recent months.

Data Wednesday showed German jobless claims rose unexpectedly in May, according to data from the Federal Employment Agency, fueling fresh concerns about the health of Europe’s largest economy.

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