Ukraine worry sparks fall in stocks, bond yields
By Chuck Mikolajczak
New York (Reuters) - U.S. stocks and bond yields fell on Tuesday after a report indicating escalating tensions in Ukraine sparked fresh concern about the region.
Wall Street stocks extended losses after a Bloomberg report that cited comments from the Polish foreign minister, Radoslaw Sikorski, who said Russian units were set to pressure or invade Ukraine.
Each of the 10 major S&P sectors closed in negative territory, with energy .SPNY the worst-performing group, down more than 2 percent. But the S&P 500 .SPX managed to pare its losses enough by the closing bell to hold right at the 1,920 support level.
The benchmark index has now declined 3.4 percent from its most recent record high on July 24.
Bonds reversed course on the Russia-Ukraine report, with yields on the 10-year note .US10YT=RR touching a session low of 2.47 percent. The benchmark 10-year U.S. Treasury was up 2/32, its yield at 2.4853 percent.
"It got to the point where it was just too frothy and you saw it coming and things needed to cool down," said Stephen Massocca, managing director at Wedbush Equity Management LLC in San Francisco.
"It was clearly the Russian thing, the Ukrainian thing. Those are rather bellicose comments from Poland so I can see where that got people a little scared."
U.S. stocks started the session in negative territory after weak economic data out of China, where the HSBC/Markit services PMI fell in July to its lowest since November 2005, suggesting a recovery in the world's second-largest economy may need further government support. Continued...