The index shed 1.8%, while the S & P 500 closed down 1.9%. The Nasdaq plunged 2.5%. It was the worst performance for all three major indexes since January 3.
The yield on 3-month treasuries rose above the 10-year Treasuries for the first time since 2007 – a shift that scared Wall Street. Investors have piled back into stocks after a sell-off in late 2018.
The flattening yield curve, or the difference between short and long-term rates, has worried investors for months. A narrowing spread is typically seen as a sign that a long-term confidence in the economy is waning, which could signal an eventual economic contraction.
The Friday's flip added to the pressure on the Dow that was building before US markets opened. index stumbled at the bell on poor manufacturing data from Germany, which also spelled trouble for the country's bond market. The yield on Germany's benchmark 1
All of that news is fueling Wall Street's ongoing concerns about slowing global growth.
White House Economic Adviser Larry Kudlow said to CNBC last year that the spread between 3-month and 10-year Treasury yields was important to watch
Michael Darda, chief economist and market strategist at MKM Partners, said in a note that investors should wait for the weekly and monthly (19659002) And he noticed that, on average, recessions occur 12 months after an inversion – not immediately