Dow plunges 799 points

ing the markets from moving higher,” said Randy Frederick, vice president of trading and derivatives at Charles Schwab.

Technology companies, banks and industrial firms accounted for much of the broad sell-off. Utility stocks rose.

Smaller-company stocks, which investors see as more risky than large multinationals, fell more than the rest of the market.

Big drops by Boeing and Caterpillar, major exporters that would stand to lose much if trade tensions persist, weighed on the Dow.

The bond market signaled its concerns as the gap between two-year and 10year Treasurys reached its narrowest since 2007. The 10year yield is still higher but not by much.

When yields for longterm bonds drop lower than yields for short-term bonds, it’s what economists call an inverted yield curve. It indicates that investors are forecasting a weaker economy and inflation in coming years. An inverted yield curve has preceded each recession of the last 60 years, though sometimes by more than a year.

“You have the drop in bond yields and the implications on growth going forward,” said Willie Delwiche, investment strategist at Baird. “The bigger issue is you have this unwind from [Monday’s] rally.”

The Standard & Poor’s 500 index dropped 90.31 points, or 3.2%, to 2,700.06.

The Dow slid 799.36 points, or 3.1%, to 25,027.07, more than erasing its 488point gain from the previous two trading days. Earlier on Tuesday, it was down as much as 818 points.

The technology-heavy Nasdaq composite sank 283.09 points, or 3.8%, to 7,158.43.

The Russell 2000 index of smaller-company stocks declined 68.21 points, or 4.4%, to 1,480.75.

The sharp turn in the markets followed a strong rally Monday fueled by optimism over the news that President Trump and his Chinese counterpart, Xi Jinping, had agreed at the Group of 20 summit over the weekend to a 90-day standdown in the two nations’ trade war.

But the market’s optimism faded Tuesday as questions arose about the scant details out of the Trump-Xi talks and skepticism grew that Beijing will yield to U.S. demands anytime soon.

“The actual amount of concrete progress made at this meeting appears to have been quite limited,” Alec Phillips and other economists at Goldman Sachs wrote in a research note.

Delwiche echoed those doubts. “The sense is that there’s less and less agreement between the two sides about what actually took place,” Delwiche said. “There was a rally in the expectation that something had happened. The problem is that something turned out to be nothing.”

Moody’s Investors Service suggested Tuesday that the United States and China remain far from resolving their dispute.

“Narrow agreements and modest concessions in their ongoing trade dispute will not bridge the wide gulf in their respective economic, political and strategic interests,” Moody’s analysts wrote in a report.

The trade war has rattled markets in recent months as signs emerged that it has begun affecting corporate profits. That has stoked traders’ fears that if it lasts much longer, it could further weigh on global economic growth.

“There are plenty of reasons to believe that growth in either the economy or the markets is going to soften next year,” Frederick said.

The jitters helped drive demand for government bonds Tuesday, pushing prices higher. The yield on the 10-year Treasury note fell to 2.91% from 2.99%, a large move. The slide in bond yields, which affect interest rates on mortgages and other consumer loans, weighed on bank stocks. Citigroup shares fell 4.5% to $62.26.

Chipmakers were among the biggest decliners in a technology sector slide. Advanced Micro Devices dropped 10.9% to $21.12, and Micron Technology slid 7.9% to $36.88.

Home builders lost ground after luxury home builder Toll Bros. issued a cautious assessment of the housing market. Toll’s shares fell 1.6% to $32.99.

Apple slid 4.4% to $176.69 after HSBC analysts downgraded the consumer electronics giant, citing the possibility that iPhone volume and value growth may moderate because of a saturated mobile phone market.

United Parcel Service slumped 7.4% to $106.77, and FedEx dropped 6.3% to $215.52. Morgan Stanley analysts said in a note that the market was underestimating the challenge those companies would face from Amazon Air.

Oil prices rose ahead of an OPEC meeting scheduled for Thursday, where members are expected to agree to cut output in 2019. Benchmark U.S. crude rose 0.6% to $53.25 a barrel in New York. Brent crude, the international standard, rose 0.6% to $62.08 a barrel in London.

Wholesale gasoline rose 0.8% to $1.44 a gallon. Heating oil rose 0.7% to $1.90 a gallon. Natural gas climbed 2.7% to $4.46 per 1,000 cubic feet.

U.S. stock and bond markets will be closed Wednesday in observance of a national day of mourning for former President George H.W. Bush.