US stocks ended lower Tuesday as more data and comments from Federal Reserve officials pointed to the likely pullback in Fed stimulus in the coming months.
At the close the Dow Jones Industrial Average was down 93.39 points (0.60 percent) at 15,518.74.
The broad-based S&P 500 fell 9.77 (0.57 percent) to 1,697.37, while the tech-rich Nasdaq Composite lost 27.18 (0.74 percent) at 3,665.77.
Stocks lost ground for the second day after last week’s new records amid more indications that the Fed will begin winding up its $85 billion a month quantitative easing program.
Related Post
The Commerce Department’s trade data for June showed a narrowing trade deficit, which analysts said points to a likely upward revision to the growth estimate for the quarter, and firm growth in the current quarter.
Meanwhile the chiefs of the Federal Reserve’s Chicago and Atlanta branches both said that the Fed could begin tapering the QE program in September, but stressed that economic growth needed to hold steady or improve.
Among stocks, Dow component IBM lost 2.3 percent after Credit Suisse downgraded the technology company to “underperform” citing headwinds facing its core products and difficulties in the cloud computing business given its technology profile.
The Washington Post Company gained 4.3 percent following news that Amazon founder Jeff Bezos is buying its struggling flagship newspaper for $250 million.
Analysts say the company, which will change its name after the sale, could be positioned to gain from its non-newspaper assets, which includes Kaplan education services. Shares of Amazon, which is not a party to the deal, slipped 0.1 percent.
Pharmaceutical retailer and benefits manager CVS fell 2.8 percent putting earnings projections for this year at $3.90-$3.96 per share, below the $3.98 expected by analysts.
Regeneron Pharmaceuticals fell 6.1 percent after revenues came in at $458 million, below the $473 million forecast by analysts. The company said it expects to apply for US marketing approval for its much-watched Eylea eye drug one year ahead of the previously announced timeframe.
American Eagle Outfitters plummeted 12.0 percent after it slashed its earnings outlook due to weaker than expected sales. The company has implemented markdowns to try to push sales higher.
Shares of entertainment giant Walt Disney gained 1.6 percent ahead of its quarterly earnings release, but then lost all of that after the post-market release showed weakness in its studio division due to losses on the flop of its heavily marketed film “The Lone Ranger”.
Bond prices were flat. The yield on the 10-year US Treasury held at 2.64 percent, while the 30-year was at 3.73 percent. Bond prices and yields move inversely.
Source: AFP
