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Stocks fall about 1% as investors digest Fed and Bernanke statements

June 19, 2013|By Andrew Tangel
  • Traders work on the floor of the New York Stock Exchange at the start of the trading day in New York.
Traders work on the floor of the New York Stock Exchange at the start of the… (Justin Lane / European Pressphoto…)

NEW YORK -- Investors' early reaction to the Federal Reserve's statement: sell.

After being essentially flat all day, stocks fell after the Fed announced it would keep interest rates low and continue its massive stimulus program -- for now. 

The Dow Jones industrial average deepened its losses as Chairman Ben Bernanke spoke at a news conference in Washington.

The Dow was down 145.22 points, or 0.95%, to 15,173.0 in late trading.

The broader Standard & Poor's 500 index was off 16.50 points, or 1%, to 1,635.31.

The Nasdaq lost 30.99 points, or 0.89%, to 3,451.19.

Investors are still digesting the Federal Reserve's statement following its June meeting, and Bernanke's news conference was held as the trading day was coming to a close in New York.

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“The markets are realizing that tapering is coming -- we don’t know when, but it’s coming,” said Marc Doss, regional chief investment officer for Wells Fargo Private Bank.

The Fed's brighter outlook for the U.S. economy may hasten its winding down of its $85 billion-a-month bond purchases, known as quantitative easing.

Bond yields continued to rise, in apparent expectation of an eventual Fed slowdown in bond purchases.

The 10-year Treasury yield, which has recently spiked, rose further to 2.314%.

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