Fed Minutes Drop Dow For Sixth Straight Day

By: From CNN Money
By: From CNN Money


NEW YORK (CNNMoney) -- On a volatile trading day, the release of the Federal Reserve's minutes pushed U.S. stocks lower Wednesday.

The Dow Jones industrial average fell more than 100 points. It was the Dow's sixth straight day of declines, its worst losing streak in more than a year. The S&P 500 and Nasdaq also limped into the close and finished the day lower. Both of those indexes had been in positive territory in late afternoon trading.

Investors had hoped the minutes from the Fed's latest meeting would answer questions about when the central bank would start to pull back on its bond purchases. They didn't.

The Fed essentially said that it is still looking for continued improvement in the job market, and hinted it may not yet ready to taper its bond-buying program.

Bond investors did not seem so happy though. The 10-year Treasury yield increased to 2.9% as bond selling picked up following the minutes.

Investors will now be closely watching the August unemployment numbers, due out on September 6th, for any indication of improvement in the labor market. Stronger jobs numbers could prove to be a catalyst for the tapering of the stimulus markets have come to depend on.

Home improvement retailers show improvement: Looking at individual stocks on the move, Lowe's (LOW, Fortune 500) announced that its quarterly sales and profit rose from a year earlier. The strong results from the home improvement retailer come a day after rival Home Depot (HD, Fortune 500) also issued an upbeat outlook thanks to the continued recovery in the housing market. In another positive sign for housing, existing home sales rose 6.5% in July from the prior month.

The retail losers: Target (TGT, Fortune 500) shares fell even after the retailer announced significant year-over-year gains in sales. Traders seemed worried about slowing sales growth and a more tepid outlook for consumer spending.

Shares of Staples (SPLS, Fortune 500) dropped more than 15% after the office supply retailer reported lower quarterly sales and profit compared to the prior year. The CEO blamed the declines on weakness in retail stores and said the company was working to ramp up its online sales.

Two other niche retailers, teen apparel seller American Eagle Outfitters (AEO) and pet supply retailer PetSmart (PETM, Fortune 500)also disappointed investors. But some thought the sell-off in PetSmart may be overdone.

Hewlett-Packard (HPQ, Fortune 500) reported its latest earnings after the closing bell. Sales and profits were mostly in line with forecasts. But the stock fell in after-hours trading. The PC and printer giant is this year's best performer in the Dow as investors have embraced the turnaround strategy of CEO Meg Whitman.


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