More signs of distress in China's economy and rising bond yields led to a broad sell-off in stocks Monday, leaving key market indexes down more than 5 percent from their record highs last month.
It was the first 5 percent decline -- referred to on Wall Street as a "pullback" -- since November. Pullbacks that occur during bull markets tend to be "nasty and brutish" -- but short, said John Manley, chief equity strategist at Wells Fargo Funds Management. He said it's common to get declines of 3 percent to 7 percent "as the market restores a reverence to risk to the investing public."
U.S. trading started with a slump. The market recovered much of its loss, then fell back again. The Dow Jones industrial average fell as much as 248 points in the first hour of trading. The yield on the 10-year Treasury note spiked to its highest in almost two years as the sell-off brought down prices of U.S. government debt. Gold and other metals also fell.
Stocks got closer to break-even around midday before falling again in the last hour. The Dow finished down 139.84 points to close at 14,659.56. The Standard & Poor's 500 index fell 1.21 percent, closing at 1,573.09. The Nasdaq composite index dropped 1.09 percent to 3,320.76.