Stocks fade as nervous investors watch 2016 election

By KEN SWEET

NEW YORK (AP) — Stocks closed broadly lower on Tuesday, as nervous investors continued to monitor the run-up to the 2016 election, which is turning out to be closer than previously expected.

Newspaper stocks fell as Gannett and Tronc, publisher of The Los Angeles Times, called off a merger and drugmaker Pfizer fell as the company cut its full-year forecast.

The Dow Jones industrial average lost 105.32 points, or 0.6 percent, to 18,037.10. The Standard & Poor's 500 index lost 14.43 points, or 0.7 percent, to 2,111.72 and the Nasdaq composite lost 35.56 points, or 0.7 percent, to 5,153.58.

Increasingly, investors' focus has been the presidential election, as polls between Hillary Clinton and Donald Trump appear to have tightened following last week's news that the FBI had opened a new investigation into Clinton's private email server. The narrowing in the race has introduced a new element of uncertainty into financial markets; something that analysts say is likely to keep trading in check.

There were several signs of nervousness in the market. Gold prices rose and the Mexican peso, which has become a proxy for Trump's chances to win, has been falling steadily against the U.S. dollar since Friday. The peso lost nearly 2 percent against the dollar, a significant move in currency trading.

"While Hillary Clinton is still expected to win the final vote, email concerns notwithstanding, next week's outcome could well be too close for comfort," said Michael Hewson, chief markets analyst at CMC Markets.

Notably, the VIX, a measure of volatility that is nicknamed Wall Street's "fear gauge," jumped 14 percent on Tuesday to its highest level since June.

"The tightening in the polls has gotten the market into a bit of a risk-reduction mode. A week ago it was a Clinton blowout. Now, all of a sudden, it's turning into a bit of a race," said Tom di Galoma, managing director of Treasury trading at Seaport Global Holdings.

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