US stocks fall as Tesla drops, rate cut timing weighed
U.S. stocks fell on Tuesday as investors weighed chances that the Federal Reserve could delay cutting interest rates, while Tesla shares dropped after the electric car maker posted fewer quarterly deliveries for the first time in nearly four years.
Tesla's stock fell more than 5% and was among the biggest drags on the S&P 500 and Nasdaq.
Adding to caution, U.S. Treasury 10-year yields rose to their highest since late November.
«The narrative of 'higher for longer' is coming back into play despite the fact that the Fed does see a rate cut sometime this year. So this has got the market worried,» said Quincy Krosby, chief global strategist at LPL Financial in Charlotte, North Carolina.
Recent solid U.S. economic reports have raised doubts about whether the Fed could deliver the three rate cuts outlined in its latest forecast.
Data on Tuesday showed new orders for U.S.-manufactured goods rebounded more than expected in February, while U.S. job openings held steady at higher levels.
The Dow Jones Industrial Average fell 437.15 points, or 1.1%, to 39,129.7. The S&P 500 lost 46.03 points, or 0.88%, at 5,197.74 and the Nasdaq Composite dropped 190.95 points, or 1.16%, to 16,205.89.
Healthcare shares were among the day's weakest performers. UnitedHealth, CVS Health and Humana fell as the U.S. government kept reimbursement rates for providers of Medicare Advantage health plans unchanged, in a setback for insurers.
The CBOE Volatility index, Wall Street's fear gauge, touched an over two-week high.
Traders are pricing
