NEW YORK (AFP) – Wall Street stocks finished solidly lower for a second straight session on Thursday (Aug 18) following Federal Reserve minutes that signalled a likely pullback on stimulus measures later this year.
The minutes showed broad consensus among policymakers on their expectations for a slowdown in the massive purchases of bonds and securities in the coming months.
The minutes were not surprising given recent commentary from Fed officials and initially provoked little movement in stocks, but equities fell sharply in the final hour of trading.
The Fed minutes are “just an excuse for the investors to take some money off the table,” said Peter Cardillo of Spartan Capital Securities.
The Dow Jones Industrial Average ended down 1.1 per cent at 34,960.69.
The broad-based S&P 500 also fell 1.1 per cent to 4,400.27, while the tech-rich Nasdaq Composite Index shed 0.9 per cent to 14,525.91.
The pullback came after a disappointing US retail sales report prompted a similar pullback on Tuesday in a move seen partly as profit taking.
On Wednesday came the Fed minutes as well as mixed homebuilding data and solid earnings reports from retailers.
Housing projects started last month fell 7 per cent compared to June to an annual rate of just over 1.5 million units, seasonally adjusted, the Commerce Department said, a drop far greater than economists had expected.
However, building permits issued in the month rose 2.6 per cent, breaking a string of declines and signaling more projects are in the pipeline.
Large retailers continued to report good earnings for the just-finished quarter. Home-improvement retailer Lowe’s surged nearly 10 per cent following its results, while Target lost 2.8 per cent.