July 12 (BP) — U.S. markets fell for the second consecutive session Tuesday as investors focused on currencies and commodities.
The Dow Jones Industrial Average dropped 192.51 points, or 0.62%, to close a rollercoaster day that saw the blue-chip index climb as much as 172 points at one point and fall more than 300 points at session lows.
Meanwhile, the S&P 500 fell 0.92% and the Nasdaq Composite closed the day down 0.95%.
“There’s a lack of a catalyst, a lack of leadership right now,” Keith Lerner of Truist said. “Growth is slowing and global central banks are still in tightening mode, and I think that’s concerning the markets.”
The euro fell to $1.003 mid-Tuesday morning, placing it near parity with the dollar for the first time since November 2002, heightening recession fears in Europe. Bitcoin also fell below $20,000 Tuesday morning.
Crude oil futures fell more than 8% to trade below $96 per barrel.
“Now that the commodity prices are falling again and inflation peak looks to be within reach, it is likely that we are seeing the worst of financial conditions tightening,” Tamara Basic Vasiljev, senior economist at Oxford Economics, said.
“If so, conditions worsening is dire, but the level is still more in favor of an orderly slowdown rather than a recession.”
Investors appeared to turn away from stocks in favor of the dollar and U.S. treasuries, with the 10-year treasury yield falling two basis points to 2.971%. That placed the spread between the 10-year and two-year treasury note on track for its flattest close since 2007.
Tech stocks closed lower after briefly posting gains earlier in the day, with Salesforce falling 4.64%, Microsoft dropping 4.1%, Amazon declining 2.26%, Netflix stock losing 1.63% and Google parent Alphabet sliding 1.43%.
American Airlines stock gained 9.98% after it reported it expected total revenue in the second quarter to exceed pre-pandemic levels, while United rose 8.09%, Delta increased 6.15% and Southwest gained 4.67%.
Pepsi stock fell 0.57% despite reporting better-than-expected profit and revenue for the quarter, as well as raising its revenue outlook for the remainder of the year.
Delta Air Lines and JPMorgan Chase are set to report earnings later this week.
Investors are also anticipating June’s consumer price index report, which is to be released Wednesday.