April has not been kind to investors thus far, as a host of asset classes declined Tuesday, a worrisome omen with stocks fresh off of their best first quarter in five years.
A trader works the floor of the New York Stock Exchange at the opening bell on Tuesday.
The Dow Jones Industrial Average declined 420 points, or 1.1%, by 10:30 a.m. EDT, while the S&P 500 dropped 1% and the tech-heavy Nasdaq fell 1.4% on Tuesday.
After its 240-point loss Monday, the Dow is down about 760 points over the first two days of April, pacing toward its worst two-day point loss since March 9-10, 2023.
Dragging the Dow down Tuesday was the index’s biggest constituent by weight, health insurer UnitedHealth, as its shares fell about 6% to their lowest point since July as the market reacted to lower forecasted revenues from Medicare Advantage healthcare plans next year.
Shares of electric vehicle Tesla also tanked about 6%, sinking the S&P and Nasdaq after the electric vehicle maker reported its first annual decline in car deliveries in nearly four years.
Broadly driving losses was a growing sense that interest rates will remain higher for longer, reflected by 5-year, 10-year and 30-year U.S. Treasury bond yields hitting their highest level since November on Tuesday, weighing on stock prices as investors can opt for high-yielding, lower-risk government bonds.
Crude oil prices for U.S. benchmark West Texas Intermediate and international benchmark Brent Crude rose Tuesday to their highest respective levels since late October amid escalating strife in the Middle East. Higher oil prices typically bring higher energy costs for consumers, which can cause an increase in inflation and thus a less aggressive growth-friendly shift in monetary policy from the Federal Reserve.
Cryptocurrency prices also dropped, as bitcoin, ether, Binance coin and Solana each declined more than 7% over the last 24 hours.
Tuesday’s selloff comes after a rosy stretch for investors highlighted by all three major indexes notching all-time highs, bitcoin hitting a record price and moderating inflation. The S&P has still returned a balmy 23% to investors over the last six months. Still, Tuesday’s losses serve as a reminder of the cracks that can show even during the strongest of bull markets; JPMorgan Chase warned last week of the risk of “flash crashes” in this market.