Stocks fall for fourth day straight
Stocks dropped for a fourth day in a row as a rise in bond yields and banking stocks dragged down the broader market. Four stocks fell for every one that rose on the New York Stock Exchange.
U.S. stocks dropped for a fourth day in a row Monday as investors continued to express worry about the recent rise in bond yields. Banking stocks also dragged down the broader market.
The Dow Jones industrial average dropped 70.73 points, or 0.47 percent, to 15,010.74. The Standard & Poor's 500 index lost 9.78 points, or 0.6 percent, to 1,646.05. The market fell broadly; 4 stocks fell for every one that rose on the New York Stock Exchange.
The technology-heavy Nasdaq composite index also fell, losing 13.69 points, or 0.48 percent, to 3,589.09. The Russell 2000 index, which is made up of primarily riskier, small-company stocks, fell nearly twice as much as the S&P 500. That index fell 11.05 points, or 1 percent, to 1,013.25.
Investors had little data to digest Monday, so the focus for many remained the ongoing climb in bond yields. The yield on the benchmark 10-year Treasury note rose to 2.88 percent from 2.83 percent Friday. Yields are at their highest level since July 2011.
The 10-year yield has been rising sharply from a recent low of 1.63 percent reached in early May as the economy has improved and as investors anticipate an end to the Federal Reserve's huge bond-buying program as early as next month. The program has been keeping interest rates low to encourage borrowing and hiring.
"We've been in this artificially low interest rate environment for so long, it's hard to figure out what 'normal' is," said Jim Dunigan, chief investment officer with PNC Wealth Management.
The quick rise in bond yields has worried some investors because it leads to higher interest rates on many kinds of loans, including home mortgages and corporate loans.
"I do think we're not too far away from that point in time where this heavy increase in bond yields is going to start impacting the (stock) markets," said Doug Peebles, chief investment officer of AllianceBernstein Fixed Income.