Stocks - Stocks Plunge as 10-Year Yield Drops Below 1%
Investing.com
Published Mar 03, 2020 01:11PM ET
Updated Mar 03, 2020 02:22PM ET
By Yasin Ebrahim
Investing.com – Wall Street fell sharply Tuesday, paced by financials amid a plunge in U.S. Treasury yields to record lows on expectations for more Federal Reserve rate cuts and worries over the ongoing coronavirus spread in the U.S.
The S&P 500 sank 2.5%, the Nasdaq Composite lost 2.8% and the Dow Jones Industrial Average fell 2.8%, or 740 points.
A Westchester County man has tested positive for the coronavirus, New York Governor Andrew Cuomo said on Tuesday, bringing the total of confirmed cases in the state to two and to more than 100 in the country overall.
The number of Covid-19 cases in the U.S. increased by 17 over 24 hours, with at least six deaths reported so far and as many as 108 infected, the Centers for Disease Control and Prevention said.
Against the backdrop of rising infections in the U.S., the Federal Reserve delivered a surprise half-a-point rate cut on Tuesday, taking its benchmark rate to 1% to 1.25%.
With the virus impact mainly on the supply side, many have questioned how much the Federal Reserve's move will support the economy. Still, the move has raised expectations for more cuts in the coming weeks, sending U.S. Treasury yields to record lows.
The United States 10-Year yield fell below 1% for the first time ever, forcing banking stocks even deeper into the red. It set an all-time low of 0.906%.
JPMorgan (NYSE:JPM), Goldman Sachs (NYSE:GS) and Bank of America (NYSE:BAC) fell sharply, with the latter down more than 5%.
Lower interest rates are typically a headwind for banks, weighing on net interest margin – the difference between the interest income generated by banks and the amount of interest paid out to their lenders.
Get The News You Want
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.