U.S. stocks are opening slightly lower Wednesday as banks continue to tumble along with bond yields and interest rates. The losses are being limited by gains in utilities and other high-dividend stocks, which investors tend to favor as a source of income when bond yields are low. Sears is plunging after saying it may not be able to stay in business. The market is coming off its biggest loss in five months.
KEEPING SCORE: The Standard & Poor’s 500 index shed 6 points, or 0.3 percent, to 2,337 as of 10:12 a.m. Eastern time, its lowest level in more than a month. The Dow Jones industrial average fell 81 points, or 0.4 percent, to 20,585, dragged down by a steep fall in Nike. The Nasdaq composite fell 6 points, or 0.1 percent, to 5,787. The Russell 2000 index of smaller companies sank 6 points, or 0.4 percent, to 1,340.
On Wednesday the market suffered its biggest one-day loss since October as investors wondered if key aspects of President Donald Trump’s agenda will be delayed. The Republican-backed American Health Care Act appears to be in trouble ahead of a House of Representatives vote on Thursday. That could affect Trump’s proposals for business-friendly policies like tax cuts, looser regulations and infrastructure spending.
TEARS FOR SEARS: Sears said in a regulatory filing that there is “substantial doubt” it will be able to remain in business. In recent years the parent company of Sears and Kmart has closed more than 2,000 stores, slashed spending and jobs, sold brands and split off its real estate assets to raise cash. The company continues to lose billions a year as its sales fall further. It said its pension agreements may prevent it from spinning off other businesses. The stock has already been trading near all-time lows and lost $1.04, or 11.4 percent, to $8.06 Wednesday.
The company’s real estate investment trust, Seritage, lost 92 cents, or 2.1 percent, to $42.63.
DIDN’T DO IT: Shoe and athletic apparel giant Nike dropped as Wall Street wasn’t impressed with its third-quarter results, which included slightly disappointing sales, or its forecasts for the current period. Nike shares fell $3.52, or 6.1 percent, to $54.48. The stock is up this year but hasn’t recovered from a 19-percent tumble in 2016. Investors have worried about Nike’s intense competition with rivals Under Armour and Adidas.
BANK DROP: Bond prices rose. The yield on the 10-year Treasury note fell to 2.40 percent from 2.42 percent. U.S. Bancorp lost 50 cents to $52.19 and Regions Financial fell 20 cents, or 1.4 percent, to $13.90.
Financial stocks in the S&P 500 index have fallen for three days in a row as bond yields fall, which leads to lower interest rates and loans such as mortgages and lower profits for banks. On Wednesday the bank index took its biggest loss in nine months.
ENERGY: Benchmark U.S. crude lost 60 cents, or 1.2 percent, to $47.64 a barrel in New York. Brent crude, used to price international oils, fell 68 cents, or 1.34 percent, to $50.28 a barrel in London.
CURRENCIES: The dollar slipped to 111.02 yen from 111.90 yen. The euro dipped to $1.0802 from $1.0804.
OVERSEAS: Britain’s FTSE 100 index slid 0.8 percent. The CAC 40 in France dropped 0.8 percent and the German DAX fell 0.4 percent. In Japan the Nikkei 225 stock index fell 2.1 percent as the yen strengthened compared to the dollar, which hurts Japanese exporters. The Hang Seng of Hong Kong dropped 1.1 percent and the South Korea’s Kospi lost 0.5 percent.
