Investing.com -- U.S. stocks pared sharp declines on Tuesday, extending recent losses, as yields on 10-Year German Bunds moved into negative territory for the first time in history and mounting Brexit concerns rattled global markets, spilling over into the major indices.
Investors continued to keep a close eye on developments in the U.K., as voters reportedly shift sentiments to the "Leave" campaign in next week's controversial Brexit referendum. An online poll from TNS said the Leave vote widened its lead over a vote to Remain by a 47-40 margin, as Rupert Murdoch's Sun newspaper backed a campaign to depart from the European Union. A slew of major world leaders including U.K. prime minister David Cameron, Germany chancellor Angela Merkel and International Monetary Fund managing director Christine Lagarde have issued stark warnings in recent weeks on the ramifications a British departure from the EU could have on the global economy at large.
The Dow Jones Industrial Average fell 57.52 or 0.32% to 17,674.96, while the NASDAQ Composite index lost 4.89 or 0.10% to 4,843.55, building off Monday's losses. At session lows, the Dow fell as much as 130 points. The S&P 500 Composite index, meanwhile, dropped 3.74 or 0.18% to 2,075.32, even as six of 10 sectors closed in the green. Stocks in the Telecom and Utilities industries led, each gaining more than 0.45% on the session. Stocks in the Financials sector lagged, plunging 1.29% on the day.
In Germany, yields on 10-year bunds fell to a record low at Minus-0.034 before rallying slightly to Minus-0.008, as risk-adverse traders continued to pile into safe-haven assets, pushing yields lower. Meanwhile, yields on the Japan 5-Year fell to a record-low at Minus-0.28%. Yields on the U.S. 10-Year were not immune to the global yield crush, falling to three-month lows at 1.567%, before rebounding to 1.625% in U.S. afternoon trading.
Market players also traded cautiously on Tuesday, as the Federal Reserve kicked off its two-day June monetary policy meeting. While the Federal Open Market Committee (FOMC) is expected to leave short-term interest rates unchanged on Wednesday afternoon, the FOMC could provide critical hints on the timing of its next interest rate hike.
The top performer on the Dow was General Electric Company (NYSE:GE), which surged 0.61 or 2.04% to 30.44. It came after the multinational conglomerate announced a Memorandum of Understanding with French engineering company Technip (PA:TECF) on a joint project to co-develop digital solutions for the Liquefied Natural Gas (LNG) industry. GE also unveiled digital power plant software for steam on Tuesday aimed at enhancing efficiency and reducing emissions of coal-fired plants.
The worst performer was American Express Company (NYSE:AXP), which slid 2.60 or 4.08% to 61.07. A plethora of prominent credit card stocks suffered losses after Synchrony Financial (NYSE:SYF) reported that it expects net charge off rates to increase 20-30% over the next year, as consumers struggle to repay loans. For the first quarter, Synchrony's write off percentage per total loans increased slightly from 4.53 to 4.7%.
The biggest gainer on the NASDAQ was Symantec Corporation (NASDAQ:SYMC), which added 0.56 or 3.08% to 18.77. It came one day after Symantec (NASDAQ:SYMC) announced the acquisition of internet security provider Blue Coast for $4.65 billion in a cash deal. The transaction is expected to expand Symantec's portfolio of security technologies during their transition to the cloud. The worst performer was American Airlines Group (NASDAQ:AAL), which fell 1.45 or 4.56% to 30.35. Airlines stocks fell sharply for the second straight day in the wake of Sunday's mass-shooting at a nightclub in Orlando that claimed the lives of 49 people and injured 50 others.
On the New York Stock Exchange, declining issues outnumbered advancing ones by a 1,989-1,065 margin.