Wall Street index plunges for fear of recession | Economy

The Dow Jones lost 3.1% to 25,027 points, the S & P 500 lost 3.23% to 2,700 points and the Nasdaq lost 3.8% to 7,158 points.

The comments of a leading Federal Reserve authority on the trajectory of rising interest rates have fueled uncertainties in the eyes of investors, as have the failures of the UK's plans for to leave the European Union.

The S & P 500 recorded the largest daily decline in about two months, registering gains over the previous day and the week before, when the index posted its highest percentage increase. in almost seven years.

Investors focus on Treasury yields as 10-year returns have fallen since mid-September. The difference between 10-year and 2-year paper yields has also fallen to its lowest level in more than a decade, a sign that needs to be closely watched as the yield curve reverses – when the two-year yield is above the 10-year return – preceded recessions over the last 50 years.

Part of the curve is actually reversed, with gains over two and three years remaining above the five-year return on the second day.

"These are fears about the reversal of the yield curve and what it means for the economy and a precursor to the recession," said Chuck Carlson of Horizon Investment Services.

The New York Stock Exchange and the Nasdaq will be closed Wednesday for the mourning of former President George H. W. Bush, who died on Friday.

Financial stocks, particularly sensitive to fluctuations in the securities market, decreased by 4.4%.