Stocks fall again as banks fall and oil prices rise

By Paul R. La Monica, CNN Business

March is very similar to January and February on Wall Street. This is not good news for investors.

the Dow fell nearly 600 points on Tuesday, or 1.8%, a day after stocks capped their second consecutive month of decline to start the year. The Dow, however, managed to end its lows of the day.

the Nasdaq and S&P500 were also hit hard, with each index falling by around 1.6%.

Rise in oil prices, which climbed nearly 10% on Tuesday to over $104 a barrel for the first time in more than seven years, is hurting sentiment. So is the rapid fall in long-term bond yields. The 10-year Treasury rate fell to around 1.7%, its lowest level since early January.

Falling bond rates are bad news for financial companies, which tend to make more money from lending and other activities when rates are higher. American Express, JPMorgan Chase, Visa and Goldman Sachs were among the Dow’s biggest losers on Tuesday.

Investors are now betting that rates will also stay quite low for some time. According to CME futurestraders are even banking on a 2% chance that the Federal Reserve will keep rates at zero at its next meeting on March 16.

The Fed is still expected to hike rates, but now by only a quarter point. A week ago, the market was torn between whether the Fed would hike rates by a quarter point or half a point.

Fed Chairman Jerome Powell may talk more about the direction rates are heading in his semiannual testimony to Congress this week. He speaks before the House Committee on Financial Services on Wednesday and the Senate Banking Committee on Thursday.

Chevron was the biggest gainer in the Dow on Tuesday, rising almost 4%. The energy giant is benefiting from rising oil prices and the company has also raised its share buyback target this year.

Retail stocks were also among the market gainers on Tuesday. Target and Kohl’s both announced higher-than-expected earnings and a strong outlook for 2022. Target stocks jumped 10% on the news.

Kohl’s stock rose 2% and Dow components Walmart and Home Depot also rallied.

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CNN’s Matt Egan contributed to this story.

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Felix J. Dixon