Major US stock indexes fell sharply against the background of declining bank shares, as the collapse in US bond yields made investors think about slowing growth, while industrial and technology stocks fell on skepticism about the chances for a breakthrough in US trade negotiations.

In addition, the rate of business activity in New York worsened in November and was below average forecasts. This was evidenced by a report published by the Institute for Supply Management (ISM) of New York. According to the data, the index, which assesses the economic conditions in the sectors of production and services for companies registered in New York, fell in November to 67.8 points from 69.8 points in October. It was predicted that the index will drop to 69.5 points. At the same time, the index reflecting economic conditions in 6 months rose to 73.4 points from 70.9 points in October.

Separate data showed that the US economic optimism index, calculated by the Investor's Business Daily newspaper and the research firm TechnoMetrica Institute of Policy and Politics, worsened in December, despite the projected increase. The index fell to 52.6 points from 56.4 points in November, and reached a minimum since April. Experts expected it to grow to 57.3 points. The index of economic optimism consists of three main components. This month, all three components have declined. The sub-index of economic prospects - a measure of what consumers think about the prospects of the economy in the next six months - fell to 46.4 points from 53.2 points. The sub-index of personal financial prospects for the next six months fell to 60.8 points from 62.3 points. Meanwhile, the sub-index of confidence in the federal economic policy fell to 50.6 points from 53.7 points in November.

All DOW components recorded a drop (30 out of 30). Caterpillar Inc. shares turned out to be an outsider. (CAT, -6.93%).

All sectors of the S & P finished trading in the red. The industrial goods sector fell the most (-4.4%).

U.S. stock-index futures fell moderately on Tuesday, as investors reined in their optimism over a breakthrough in the U.S.-China trade war.

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Apple (AAPL) downgraded to Hold from Buy at HSBC Securities

A negative start to trading in European stock exchanges is expected, as doubts start to arise as to whether the United States and China will be able to resolve their differences.

As the yuan rose further as well, the Shanghai Composite climbed 0.4%, as did the Shenzhen Composite and startup-heavy ChiNext. Helping both asset classes have been pep talks from official media. Airline stocks rose more than 3% today while shell companies and venture-capital firms were back under the spotlight. Hunan TV & Broadcast and Chaohua Technology logged limit-up gains today. - WSJ