NEW YORK – US stocks closed sharply lower and Treasury yields extended their slide on Friday over fears of contagion in the financial sector and strong February employment data showing the economy added more jobs than expected.
All three major US stock indexes ended the session down more than 1 percent, with the tech-laden Nasdaq suffering the largest percentage loss.
The indexes ended a tumultuous week significantly lower than last Friday’s close. The S&P had its biggest weekly percentage loss since September, while the Nasdaq and the Dow notched their largest respective losses since November and June.
Shock waves continue to reverberate through global financial stocks after regulators closed SVB Financial Group following the bank’s failed attempt to raise capital.
The Dow Jones Industrial Average fell 345.22 points, or 1.07 percent, to 31,909.64, the S&P 500 lost 56.73 points, or 1.45 percent, to 3,861.59 and the Nasdaq Composite dropped 199.47 points, or 1.76 percent, to 11,138.89.
European stocks slid to a seven-week low over uncertainty regarding rising interest rates, and looming worries over the health of the US banking sector.
The pan-European STOXX 600 index lost 1.35 percent and MSCI’s gauge of stocks across the globe shed 1.40 percent.
Emerging market stocks lost 1.37 percent. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 1.75 percent lower, while Japan’s Nikkei lost 1.67 percent.
US Treasury yields dropped for the second straight day as risk-averse investors sought safe haven amid brewing troubles in the financial sector.
“(There is) a growing crisis of confidence that has triggered a flight to safety,” said Sam Stovall, chief investment strategist of CFRA Research in New York. “Investors are fearful of a bank contagion and have flocked to the safety of Treasuries, elevating the price but reducing the yields.”
Benchmark 10-year notes last rose 61/32 in price to yield 3.6892 percent, from 3.923 percent late on Thursday.
The 30-year bond last rose 101/32 in price to yield 3.6899 percent, from 3.87 percent late on Thursday. — Reuters
