Equities sank Tuesday as banking fears returned. The Dow industrials lost 1.0 percent, the S&P 500 fell 1.6 percent, and the Nasdaq was down 2.0 percent. US Treasury yields, oil prices, and the dollar all slipped, with Treasuries and oil reflecting the view that global growth is slowing.

First Republic Bank dropped 49 percent after reporting a larger than expected loss of deposits in the first quarter. The First Republic results weighed on other regional banks but their declines were more modest. Still, the news renewed worries that First Republic will fail, that other banks are in similar straits, or that a credit crunch is coming that will capsize the economy.

All S&P sectors lost ground. Materials and energy fared worst while defensive sectors including consumer staples and utilities held up best. Negative company news weighed on the market with UPS off after warning of slowing consumer spending. GE Healthcare and Northern Trust were notable decliners in the S&P 500 after disappointing quarterly results. Megacaps were under pressure amid caution before earnings from Alphabet and Microsoft due after the close.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.