Shares of banks and other financial institutions fell as the yield curve inverted further.

The yield on the 10-year Treasury note hit a three-month low, suggesting worsening expectations for U.S. economic growth.

The inversion of the yield curve has spooked stock investors, said one strategist. "After all, in the 1960-to-date era, an inverted yield curve has a nearly perfect record in forecasting a recession within two years," said Jim Paulsen, chief investment strategist at money manager The Leuthold Group, in a note to clients.

The Securities and Exchange Commission plans to issue four proposals next week to make the stock market more efficient for small investors, a key element of Chair Gary Gensler's policy agenda for Wall Street.

One brokerage said hopes of a shift in European Central Bank interest-rate policy at next week's meeting were likely unfounded. "We are not expecting a 'dovish downshift,'" said analysts at brokerage BNP Paribas, in a note to clients.

"For starters, we think the Governing Council will emphasise that the tightening cycle has further to go, despite arriving at the likely internal assessment of 'neutral' - we continue to see a terminal rate of 3%." 


 Write to Rob Curran at rob.curran@dowjones.com

(END) Dow Jones Newswires

12-07-22 1722ET