‘A Narrative of Fear’: Plunging Stocks Finally Heed Bond Signal
- S&P 500 falls from record high amid worries over growth, virus
- Sub-1.25% rate would spark fear ‘something is wrong or broken’
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Growth is slowing while stock valuations expand and breadth narrows. Throw in a surprising drop in Treasury yields and the result is volatility.
The S&P 500 Index fell as much as 1.6% on Thursday, the most since May, as all major industries slipped. Commodity and financial shares led the retreat, the latest sign that the once-hot reflation trade is sputtering, with the delta variant of coronavirus quickly spreading and talk about monetary stimulus heating up in China.