Published: Wed, May 16, 2018
Money | By Bruce West

Dow drops almost 200 points

Dow drops almost 200 points

Losses in technology and health care companies helped pull USA stocks lower Tuesday, placing the Dow Jones industrial average on track to end an eight-day winning streak. Homebuilders fell sharply as a result.

Australian stocks bucked the region's downward trend, rising 0.4%. KeyCorp rose 1.5 percent. Hong Kong's Hang Seng slipped 0.1 percent to 31,116.35, but the S&P ASX 200 added 0.4 percent to 6,120.60.

The Nasdaq fell 0.8 percent, to 7,351.63. Smaller rival Lowe's Companies Inc (LOW.N) was down 1.0 percent.

Stocks are moving mostly lower in midday trading on Wall Street, led by technology and health care companies. Bond yields tend to rise when investors expect faster economic growth and higher inflation.

The rise in bond yields pulled down shares in real estate investment trusts and other high-dividend-paying stocks. The surge came after the Commerce Department said retail sales climbed 0.3 percent in April, suggesting that spending by consumers is rebounding as expected after a weak first quarter.

Tuesday ended an eight-day run of consecutive gains for the Dow Jones.

Retail sales reported a monthly increase of 0.3%.

The yield on the 10-year Treasury rose to 2.99 percent.

The S&P 500 index fell 18.68 points, or 0.7 percent, to 2,711.45. The Shanghai Composite index dropped 0.3 percent to 3,183.28 and shares in Southeast Asia were lower while Taiwan advanced. Nvidia fell 4.4 percent to $244.13.

A surge in US government bond yields to their highest level in nearly 7 years sent Wall Street shares sliding on Tuesday after strong retail sales data stoked inflation concerns and investors fretted about looming trade talks between the United States and China. Mortgage rates, which have been rising this year, tend to track the movement in the 10-year Treasury yield. That yield is used to set interest rates on mortgages and other kinds of loans.

The Toronto Stock Exchange's S&P/TSX composite index rose 12.20 points, or 0.08 per cent, to 16,097.81.

The Dow Jones industrial average lost 162 points, or 0.6 percent, to 24,739.

The biggest drags on the sector were Kinross Gold Corp., which fell 2.5 per cent, and Barrick Gold Corp., which dropped 1.9 per cent.

Brent crude oil settled at $78.43 a barrel, up 20 cents, or 0.3 per cent, after reaching an intraday peak of $79.47 a barrel, up $1.24 and its highest since November 2014.

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