FINANCIAL MARKETS

NEW YORK—A bad day for bank stocks pulled the Dow Jones industrial average to its third straight loss Tuesday as many of the patterns that have propelled markets since Election Day last year snapped into reverse.

The Dow Jones industrial average fell 58.96 points, or 0.3 percent, to 19,826.77, cutting into the gain it had made since Donald Trump’s surprise victory in November. The Standard & Poor’s 500 index fell 6.75, or 0.3 percent, to 2,267.89. The Nasdaq composite fell 35.39, or 0.6 percent, to 5,538.73.

The main culprit for the weakness was the financial sector, whose 2.3 percent drop was nearly triple that of any of the other 10 sectors that make up the S&P 500. The losses came even though Morgan Stanley on Tuesday morning joined the list of banks to report better-than-expected earnings for the fourth quarter.

Part of the reason for the losses was likely Tuesday’s drop in bond yields. Bank stocks have often been trading in the opposite direction of bond yields, and the yield on the 10-year Treasury note fell to 2.32 percent from 2.38 percent late Friday. Yields on twoyear and 30-year Treasurys also sank. Another reason may lie in how well bank stocks had been performing in the months earlier: Financial stocks in the S&P 500 jumped 17 percent in the two months following the election, more than any other sector in the S&P 500.

Companies that sell everyday items to consumers logged the biggest gains of the day, with those in the S&P 500 up 1.3 percent. They’re also the ones that have struggled the most since Election Day.

Utility stocks, which have also lagged the market since Election Day, did well. Those in the S&P 500 rose 1.2 percent, aided by the drop in Treasury yields. When bonds are paying less in interest, dividend-paying stocks become more attractive to income investors, and utilities have some of the largest dividend yields.

NRG Energy rose 74 cents, or 5.1 percent, to $15.34 and was one of the top-performing stocks in the S&P 500 after an investment firm run by activist investor Paul Singer disclosed an ownership stake in the power company.

The biggest gain in the S&P 500 came from Noble Energy, which rose $2.66, or 7.1 percent, to $40.05. The oil and gas company agreed to buy Clayton Williams Energy for $2.7 billion in stock and cash.

Nearly as many stocks rose on the New York Stock Exchange as fell, but the outsized losses for bank stocks were enough to drag indexes lower.

Benchmark U.S. crude oil rose 11 cents, or 0.2 percent, to $52.48 per barrel. Brent crude, used to price international oils, fell 39 cents, or 0.7 percent, to $55.47.

Natural gas fell a fraction of a penny to $3.412 per 1,000 cubic feet.