SAN FRANCISCO (CBS SF/AP) — The Dow sank 800 points Wednesday after the bond market flashed a warning sign about a possible recession for the first time since 2007.
Investors have been plowing money into long-term bonds for months, sending yields sharply lower, as they anticipate slower economic growth. The yield on the 10-year Treasury briefly dropped below the two-year yield, an ominous signal that has predicted many past recessions.
The Dow fell 800 points, or 3%, to 25,479. The S&P lost 85 points, or 2.9%, to 2,840. The Nasdaq lost 242 points, or 3%, 7,773. Bond prices soared.