Stocks Plunge on Fears of Slowing Growth…..

U.S. equities finished sharply lower, subverting last week’s rally, amid myriad concerns, including differing views and lack of details surrounding the trade truce between the U.S. and China, fears of slowing economic growth, and worries of a slowdown in housing following Toll Brothers guidance. Treasuries finished higher amid a dormant economic calendar, but it was the inversion of some yields that grabbed investors’ attention, adding another wrinkle to the anxiety. Crude oil prices pared gains to finish slightly higher ahead of this week’s OPEC meeting and the U.S. dollar recovered from an early loss to end only modestly lower, while gold gained ground.

The Dow Jones Industrial Average (DJIA) tumbled 799 points (3.1%) to 25,027, the S&P 500 Index fell 90 points (3.2%) to 2,700, and the NASDAQ Composite plunged 283 points (3.8%) to 7,158. In heavy volume, 1.1 billion shares were traded on the NYSE and 2.6 billion shares changed hands on the NASDAQ. WTI crude oil inched $0.30 higher to $53.25 per barrel and wholesale gasoline was up $0.01 at $1.44 per gallon. Elsewhere, the Bloomberg gold spot price was $8.04 higher at $1,238.71 per ounce, and the Dollar Index—a comparison of the U.S. dollar to six major world currencies—lost 0.1% to 96.97.

Treasury yields fall as concerns resurface…..

Treasuries were higher, while the U.S. economic calendar was void of any major releases today. The yield on the 2-year note dipped 2 basis points (bps) to 2.80%, the yield on the 10-year note dropped 6 bps to 2.91%, and the 30-year bond rate fell 9 bps to 3.17%. The markets are paying close attention to the yield curve, which has flattened and some yields on the short end have inverted compared to the 5-year note to cause some economic concern.

The U.S. dollar overcame early losses to finish only modestly lower and the pressure on the stock markets intensified after last week’s sharp rally that culminated with the agreement between the U.S. and China over the weekend to call a 90-day truce on further tariffs, though skepticism is flaring up regarding the agreement.

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