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Losses for banks pull US stocks further from record highs

U.S. stocks are falling for the second time in three days as banks return some of their recent gains. They surged last week as interest rates quickly rose. Losses for airlines are pulling industrial companies lower and mining and chemical companies are down after China cut its economic growth forecast. Meat producer Tyson Foods is falling after avian flu was discovered at a supplier’s farm.

KEEPING SCORE: The Standard & Poor’s 500 index fell 6 points, or 0.3 percent, to 2,376 as of 3:15 p.m. Eastern time. The Dow Jones industrial average lost 32 points, or 0.2 percent, to 20,973. The Nasdaq composite lost 18 points, or 0.3 percent, to 5,852. The Russell 2000 index of smaller-company stocks sank 9 points, or 0.7 percent, to 1,384.

All four indexes reached all-time highs last week, and the S&P 500 and Nasdaq have risen for six weeks in a row. That’s on top of a big surge in November and December.

“We think there’s a reasonable chance at the end of the year we’ll be a little bit lower than we are right now,” said Scott Wren, senior global equity strategist at Wells Fargo Investment Institute.

TYSON SKIDS: Poultry companies slumped after 70,000 chickens were destroyed at a farm because of a bird flu outbreak. The U.S. Department of Agriculture said around 30 poultry farms have been quarantined. The affected farm is a supplier to Tyson Foods, and while Tyson said the discovery won’t harm its business, for investors it brought back bad memories: in 2015, U.S. poultry producers lost 48 million birds to a different strain of the virus.

Tyson stock gave up $1.48, or 2.3 percent, to $62.12. Sanderson Farms gave up $1.79, or 1.9 percent, to $92.60 and Pilgrim’s Pride lost 29 cents, or 1.4 percent, to $20.66.

DRIVE IT OFF THE LOT: French automaker PSA Group agreed to buy General Motors’ European business, which hasn’t made a profit for GM since 1999. Investors were glad to see it go, as GM’s stock jumped almost 5 percent when the talks were disclosed last month. PSA makes Peugeot and Citroen cars, and the addition of the Opel and Vauxhall brands will make it the second-largest automaker in Europe. Its stock rose 2.7 percent.

GM’s stock dipped 39 cents, or 1 percent, to $37.84.

BUMPY LANDING: Airlines fell. Delta Air Lines gave a disappointing revenue projection for the second quarter, saying its business isn’t improving as quickly as it expected. Its stock lost $1.39, or 2.8 percent, to $48.74. United Continental and American Airlines each fell about 4 percent.

DEUTSCHE DOWN: Deutsche Bank said it will raise at least $8.5 billion in capital and sell a stake in its asset management business to shore up its finances. Deutsche Bank has been struggling to make a profit recently and has cut costs and sold some businesses, but until recently, it said it would not issue new stock. The stock fell 77 cents, or 4 percent, to $18.58. It has tumbled 42 percent over the last two years.

CHINESE CONGRESS: Over the weekend Premier Li Keqiang, China’s top economic official, trimmed the country’s growth target to 6.5 percent and warned of dangers from global pressure for trade controls. China is the second-largest economy in the world, and the prospect of slower growth there hurt mining, packaging and chemical companies and sent the price of copper lower.

THE QUOTE: Stocks plunged in early 2016 because investors were afraid about the state of the Chinese economy. But they’re not as worried about that now. Strategist Wren said Wall Street now thinks growth in China will slow down gradually.

“The market’s pretty comfortable with this controlled slowdown,” he said. “A lot of that sell-off was due to the fear that Chinese growth was … basically going to collapse,” he said.

ENERGY: Benchmark U.S. crude lost 13 cents to $53.20 a barrel in New York. Brent crude, used to price international oils, picked up 11 cents to $56.01 a barrel in London. Natural gas companies rose as futures jumped 2.6 percent to $2.90 per 1,000 cubic feet.

BONDS: Bond prices continued to slip. The yield on the 10-year Treasury note rose to 2.49 percent from 2.48 percent. Bond yields jumped last week as investors grew more certain the Federal Reserve will raise interest rates this month.

Shares of companies that pay big dividends, like real estate investment trusts, fell again. Those stocks are often compared to bonds because of their high yields, and higher bond yields make them less appealing to investors.

OTHER ENERGY TRADING: Wholesale gasoline rose 2 cents to $1.67 a gallon and heating oil picked up 1 cent to $1.60 a gallon.

METALS: Gold fell $1 to $1,225.50 an ounce. Silver rose 3 cents to $17.77 an ounce. Copper lost 4 cents, or 1.7 percent, to $2.65 a pound.

CURRENCIES: The dollar inched down to 113.92 yen from 114.05 yen. The euro dipped to $1.0588 from $1.0605.

OVERSEAS: In Germany the DAX fell 0.6 percent. France’s CAC 40 slipped 0.5 percent and the FTSE 100 in Britain shed 0.3 percent. Japan’s Nikkei 225 stock index fell 0.5 percent and the South Korean Kospi gained 0.1 percent. Hong Kong’s Hang Seng index added 0.2 percent.


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