Bonds flash another recession warning sign, even as Dow rallies 240 points

The Dow staged a comeback on Wednesday, even as the bond market was once again flashing a recession warning sign.

The 10-year US Treasury yield briefly fell below the 2-year yield Wednesday afternoon. It marked the second time the yield curve inverted this month.

A yield curve inversion happens when long-term bond yields fall below short-term yields. That rare phenomenon is considered a recession indicator. Every recession in modern history has been preceded by a yield curve inversion.

Nevertheless, stocks finished higher, clinging to their gains.

The Dow finished 240 points, or 0.9% higher, while the S<>&P 500 and the Nasdaq Composite closed up 0.8% and 0.9%, respectively. All three indexes reversed the losses they incurred on Tuesday, when the a href=”https://www.cnn.com/2019/08/20/investing/dow-stock-market-today/index.html” target=”_blank”Dow and the S<><><><><><><><><><><><><><><><><><><>