Posted by: Rainbow411 / GSHRadio on 05/17/2017

Stocks, bond yields drop Washington turmoil rattles markets

Stocks, bond yields drop Washington turmoil rattles markets

By ALEX VEIGA - 29 minutes ago May 17, 2017 

Photo: AP Photo/Richard Drew 

U.S. stocks fell sharply in late-afternoon trading Wednesday as investors fretted that the latest turmoil in Washington could hinder President Donald Trump’s pro-business agenda.

The steep drop, which sent the Dow Jones industrial average down more than 300 points, ended an unusually long period of calm in the markets. Financial stocks, which had soared in the months since the election, slumped the most as bond yields declined and traders piled into utilities, gold and other traditional safe-haven assets.

KEEPING SCORE: The Standard & Poor’s 500 index fell 36 points, or 1.5 percent, to 2,364 as of 3:04 p.m. Eastern Time. The Dow Jones industrial average slid 317 points, or 1.5 percent, to 20,662. The Nasdaq composite index gave up 135 points, or 2.2 percent, to 6,034, a day after closing at its latest record high.

Small-company stocks fell more than the rest of the market. The Russell 2000 index sank 38 points, or 2.8 percent, to 1,355. Those companies would stand to benefit even more than large ones from corporate tax cuts Trump is proposing. They also had risen sharply in the months following the election.

THE QUOTE: Investors are questioning whether or not President Donald Trump’s agenda can remain on track in light of the growing questions and allegations playing out in the media, said Quincy Krosby, market strategist at Prudential Financial.

“You could see gold was up, the dollar weakened and money went into the Treasury markets,” Krosby said. “As long as it seems as if the Trump agenda can be realized before the midterm election, it’s OK with the market, but once you introduce uncertainty into that trajectory, that’s something the market has to reassess.”

TRUMP JITTERS: A published report late Tuesday revealed that Trump allegedly made a personal appeal to now-fired FBI Director James Comey to drop the bureau’s investigation into former National Security Adviser Michael Flynn. The White House denied the report. Even so, the latest political drama unfolding in Washington weighed on markets, stoking concerns over how the potential fallout may affect the Trump administration’s ability to pass corporate tax cuts and other business-friendly reforms.

CALM RIDE ENDING? The market is coming off an unusually long period of calm after hitting a series of record highs. On Tuesday the S&P 500, the benchmark favored by professional investors, marked its 15th straight day of moving up or down by less than 0.5 percent. It closed at its latest record high on Monday.

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