Equities were mostly lower Tuesday with bank stocks hit hard after S&P downgraded several regional banks. The Dow industrial average fell 0.5 percent, the S&P 500 eased 0.3 percent, and the Nasdaq firmed 0.1 percent. US Treasury yields and the dollar rose while oil prices declined.

S&P downgraded Associated Banc-Corp, Valley National Bancorp, UMB Financial, Comerica, and Keycorp, citing various issues including funding risks, deposit outflows, and constrained profitability. Big banks sold off in sympathy, with money center banks off 1-2 percent. Disappointing earnings news from retailers Macy's and Dick's Sporting Goods also weighed on the market, offset somewhat by an earnings beat from Lowes.

Firmness in megacaps helped the major averages avoid larger losses. Homebuilders also outperformed after existing home sales data highlighted high demand for housing and very low inventories. Among sectors, best were real estate, utilities, communications services, and consumer discretionary. Worst off were financials, health care, energy, and consumer staples.

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.