Closing Bell: Stocks Slide on Uncertainty Over Tapering of Fed Stimulus
The Dow Jones industrial average (^DJI) fell 105 points, or 0.7 percent, to 14,897, extending its string of losing days to six, the longest since July 2012. The Standard & Poor's 500 index (^GPSC) dropped 9 points, or 0.6 percent, to 1,642, and the Nasdaq composite index (^IXIC) lost 13 points, or 0.4 percent, to 3,599.
The Fed appears on track to slow its bond purchases by the end of this year should the economy continues to improve. But it remains divided over the exact timing of the move, according to minutes from its July interest-rate meeting.
A few policymakers said they wanted to assess more economic data before deciding when to scale back the central bank's $85 billion a month in Treasury and mortgage bond purchases. These policymakers "emphasized the importance of being patient," the minutes said.
Stocks have slumped since Aug. 2, when the Dow and S&P 500 closed at all-time highs. Traders have been worried about weak earnings and have been looking for clarity on how and when the Fed will wind down its bond purchases.
In other economic news, the National Association of Realtors reported that sales of previously occupied homes jumped to an annual rate of 5.39 million in July from 5.06 million in June. Home sales rose to their highest level since November 2009.
Walt Disney (DIS) said it will begin laying off about 175 people in its Disney/ABC television group, about 2 percent of the unit's workforce, Reuters reported, citing a person familiar with the matter. Most of the layoffs will come in technical operations, such as broadcast engineering, and at eight ABC-owned stations across the U.S. But the ESPN cable sports operations isn't included in the cuts.
Disney shares ended Wednesday down 1.2 percent to $61.14 amid a broad market selloff.
More Stocks in the News:
- Staples (SPLS) shares slumped 15.3 percent to $14.26 after the company reported weaker-than-expected quarterly results on dismal sales in international markets and cut its outlook for the year.
- Target (TGT) warned its annual profit may be near the low end of its forecast as consumer spending remains cautious, sending shares down 2.5 percent to $65.50.
- PetSmart (PETM) dropped 5.3 percent to $71 after its results, while American Eagle Outfitters (AEO) tumbled 9.9 percent to $14.76 after giving a weak outlook.
- But home improvement chain Lowe's (LOW) rose 3.9 percent to $45.81 after it reported a bigger-than-expected rise in profit and sales as the housing market's recovery encouraged people to spend more on their homes.
- Shares of Toll Brothers (TOL) ended virtually unchanged at $31.65 after the largest U.S. luxury homebuilder reported a jump in revenue as the recovery in the housing market gathered pace.
- The Labor Department releases weekly jobless claims at 8:30 a.m. Eastern time.
- At 10 a.m., Freddie Mac reports weekly mortgage rates and the Conference Board releases leading indicators for July.
- Abercrombie (ANF)
- Aeropostale (ARO)
- Dollar Tree Stores (DLTR)
- GameStop (GME)
- Gap (GPS)
- Hormel Foods (HRL)
- Pandora Media (P)
- Sears Holdings (SHLD)