- US stocks fell sharply as investors are turning skeptical on a Fed rate cut by June.
- The 10-year Treasury yield hit its highest since November.
US stocks fell for a third straight day Tuesday as investors digested the possibility that the first Federal Reserve interest rate cut won't come in June as expected.
Markets have been repricing bets on Fed monetary policy after a batch of strong economic data suggested conditions are still running too hot for a cut.
Odds of a June pivot briefly fell below 50% after Monday's manufacturing data came in hotter than expected. Meanwhile, the $4 show that demand for labor remains elevated.
With bond traders now adjusting to the prospect of fewer Fed cuts this year, the 10-year Treasury yield hit its highest since November, peaking at 4.4%.
So far, San Francisco Fed President Mary Daly noted that three rate cuts remained reasonable, while Cleveland's Loretta Mester concurred. Both officials want to see more evidence of falling inflation.
Later this week, investors can expected commentary from Chairman Jerome Powell speak on Wednesday, while the next jobs report is set to release Friday.
Here's where US indexes stood at the 4 p.m. closing bell on Tuesday:
- S&P 500>$4: 5,205.81, down 0.7%
- Dow Jones Industrial Average>$4: 39,170.24, down 1% (397 points)
- Nasdaq Composite>$4: 16,240.45, down 1%
Here's what else happened today:
- $4, JPMorgan says.
- Ray Dalio is still investing in China, despite warnings of challenges ahead. $4.
- A $4, "Big Short" investor Steve Eisman warns.
- A record number of cities now have $4, Zillow says.
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