Wall Street dips after two-day rise
By Caroline Valetkevitch
Fed officials offered diverging views, adding to the uncertainty about the outlook for the Fed’s easy-money policies.
The day’s decline followed two days of record high closes for the Dow Jones industrial average. Tuesday’s retreat was led by the S&P 500’s financial, energy and utility sectors. A 2.2 percent drop in U.S. oil futures prices hurt energy names like Chevron, which slid 0.9 percent to $120.
Driving the market “has been worries over the timing of the taper,” said Quincy Krosby, market strategist with Prudential Financial, which is based in Newark, New Jersey.
She said investors are watching 10-year U.S. Treasury note yields, which have moved higher as speculation increases that the Fed could move sooner rather than later.
“You have had various Federal Reserve officials speaking, and the message seems to be the discussion of the taper has begun.”
During the session, bond yields hit their highest level since mid-September, though that level is still lower than a month ago.
The Dow Jones industrial average slipped 32.43 points, or 0.21 percent, to end at 15,750.67. The Standard & Poor’s 500 Index dropped 4.20 points, or 0.24 percent, to finish at 1,767.69. The Nasdaq Composite Index eked out a tiny gain of just 0.13 of a point to close at 3,919.92.
Volume was lighter for a second day, totaling about 5.8 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, below the five-day average closing volume of about 6.4 billion, according to BATS exchange data.
Some market watchers have begun to speculate that the Fed could begin to scale back on stimulus as early as December.