Stocks sink as odds of U.S.-China trade deal appear to wane

Bond yields plunge, signaling investor flight to safety as they worry that a record stock run may be nearing its end.

Stocks continued their August swoon Monday on fears that Hong Kong protests, falling worldwide bond yields and the ongoing U.S.-China trade dispute could lead to a global recession.

The Dow Jones industrial average dropped 462 points before the blue chips clawed some of that back to finish down about 390 points at 25,898, about a 1.5 percent drop. Financial services was among the hardest-hit Dow sectors, with Goldman Sachs Group off 2.6 percent. Pfizer, United Technologies and Caterpillar were also big drags. Only drug giant Merck stayed slightly above water.

The Standard & Poor’s 500-stock index finished down 36 points at 2,882, a 1.2 percent drop. The technology-laden Nasdaq composite index fell about 95 points on the day to close at 7,863, or 1.2 percent.

View the complete August 12 article by Thomas Heath on The Washington Post website here.