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Home / Business / Equities closed lower as trade eased and inversion of the yield curve increased

Equities closed lower as trade eased and inversion of the yield curve increased



US. The shares closed on Tuesday evening and reversed morning gains as hopes of a solution to the US-China trade battle eased and fears of a global economic slowdown increased.

How did the main benchmarks develop?

The Dow Jones Industrial Average

DJIA, -0.47%

fell 120.93 points, or 0.5%, closing at 25,777.90, while the S & P 500 Index

SPX, -0.32%

fell 9.22 points to 2,869.1

6, a decrease of 0.3%. The Nasdaq Composite Index

COMP, -0.34%

dropped 26.79 points, or 0.3%, to 7,826.95.

At session highs, the Dow was up 115.19 points, or 0.6%, and the S & P 500 added 20.39 points. or 0.7% and the Nasdaq had gained 23.93 points or 0.3%. At its lowest point, the Dow dropped nearly 300 points before recovering.

What drove the market?

Shares rebounded on Monday's Friday's strong selloff, giving up their gains early on Tuesday as bond yields eased and the yield curve of US Treasury bills reversed further, pointing to more concern about global economic growth. The yield curve tells how many investors are willing to pay for bonds with different time horizons. In a healthy trading environment, longer-dated bonds would have higher interest rates, but on Tuesday, yields on 30-year bonds fell below 3-month yields.

Equities rebounded on Monday after President Donald Trump signaled in a telephone call that China was ready to return to the negotiating table and officials in Beijing demanded a calm solution. However, the Chinese Foreign Ministry said it "does not notice" a call between China and the US, and it is not clear that talks will resume in September as planned.

Hu Xijin, the well-informed publisher of Chinese state-run Global Times, said Tuesday afternoon that China is in no hurry to reach a trade agreement.


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