Wall Street declines; investors take profits on financials
NEW YORK (Reuters) – U.S. stocks were lower in Tuesday afternoon trading, led by declines in the Dow Jones Industrial Average as investors took profits in some of the groups tied most closely to economic growth.
Bank stocks fell as U.S. Treasuries rallied, with the 10-year yield hitting its lowest level since Feb. 24. [US/]
Along with financials, energy and materials led declines.
At the same time, a regulatory crackdown by Beijing drove a selloff in shares of several U.S.-listed Chinese firms, including Didi Global Inc.
Alan Lancz, president of Alan B. Lancz & Associates Inc., an investment advisory firm based in Toledo, Ohio, said investors may be taking profits after a strong end of the quarter.
“It was such a good quarter end,” he said. Now, “cyclicals are really getting hit.”
With Treasury yields down, “investors may be worried the economy might not be a good as the stock market was showing,” he said.
The S&P 500 growth index also hit a record high on Tuesday, while the S&P 500 value index was down more than 1%.
The Dow fell 277.1 points, or 0.8%, to 34,509.25, the S&P 500 lost 18.84 points, or 0.43%, to 4,333.5 and the Nasdaq Composite dropped 14.12 points, or 0.1%, to 14,625.20.
Data showed U.S. services industry activity grew at a moderate pace in June, likely restrained by labor and raw material shortages.
The CBOE Volatility index rose to its highest in two weeks.
Didi Global shares fell 21.1% after Chinese regulators ordered over the weekend the company’s app be taken down days after its $4.4 billion listing on the New York Stock Exchange.
Other U.S.-listed Chinese e-commerce firms, including Alibaba Group, Baidu Inc and JD.com, fell between 2.8% and 4.9% with the Chinese crackdown also weighing on global markets.
(Graphic: Nasdaq record vs yields, )
Declining issues outnumbered advancing ones on the NYSE by a 2.31-to-1 ratio; on Nasdaq, a 2.57-to-1 ratio favored decliners.
The S&P 500 posted 47 new 52-week highs and no new lows; the Nasdaq Composite recorded 66 new highs and 73 new lows.
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