Dow Jones falls over 420 points

David Joy Ameriprise Financial’s chief market strategist on the prospect of U.S. benchmark yields hitting 3 percentSource Bloomberg

David Joy Ameriprise Financial’s chief market strategist on the prospect of U.S. benchmark yields hitting 3 percentSource Bloomberg

The S&P 500 shed 1.3 per cent, and the Nasdaq dropped 1.7 per cent.

Boeing rose 4.2 percent after reporting quarterly results that easily beat analyst expectations.

Financial and technology stocks led Wall Street lower on Wednesday as concerns about rising US bond yields eclipsed gains from Boeing and Comcast following strong results. "At the same time, bonds are behaving badly, and with both struggling, investors are feeling nervous about the market in general", said Michael Mullaney, director of global market research at Boston Partners.

Higher yields can weigh on stocks, as they push up borrowing costs for companies.

Later in the day Caterpillar stock fell 6.2 percent after Chief Financial Officer Bradley Halverson said the company's first quarter would be "the high-water mark for the year" during a conference call. The investors sell American government securities because of expectations of rising inflation.

The Dow Jones industrial average plunged as much as 619 points as investors feared that rising oil prices and other costs will slow down growth in company profits.

The CBOE Volatility index, a gauge of short-term stock market volatility jumped to more than 1-week high to 19.41 points. The company reported a stronger-than-expected rise in revenue and launched a formal bid for Sky ( In addition, higher yields can make bonds appear more attractive than stocks, which come with higher risk.

General Electric fell more than 4 percent after Moody's changed its ratings outlook on the company.

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Bond prices fell. The yield on the 10-year Treasury rose to 2.99 percent.

The Nasdaq composite tumbled 121.25 points, or 1.7 percent, to 7,007.35. Shares fell per cent after the company posted in-line profits as lower taxes offset a miss in operating profits and the company lowered its 2018 earnings forecast.

Caterpillar warned of weaker profits and 3M, like several other manufacturers reporting their quarterly results, said it was seeing higher costs for raw materials.

Oil topped $75 a barrel before plunging more than 2.5%.

Declining issues outnumbered advancing ones on the NYSE by a 1.94-to-1 ratio; on Nasdaq, a 1.71-to-1 ratio favored decliners.

The S&P 500 is down 39.05 points, or 1.5 percent.

Volume on US exchanges was 7.22 billion shares, compared to the 6.80 billion average for the full session over the last 20 trading days.

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