August 10, 2010 by staff
Federal Reserve, “Net-net indicates that the Fed will remain accommodative, but also ready to take additional measures to keep liquidity flowing into the market,” said Wasif Latif, vice president of equity investments at USAA.
Recovering from a fall of more than 140 points, the Dow Jones Industrial Average / quotes/comstock/10w! I: DJI / late (DJIA 10 644, -54.50, -0.51%) closed down 54.50 points, or 0.5%, to 10644.25.
Intel Corp. / quotes/comstock/15 *! INTC / quotes / nls / INTC (INTC 19.84, 0.02, 0.10%) led losses among blue chips, with chip maker’s stock, as well as non-blue chip rivals hit asanlysts questioned the demand for computers and related equipment in an unstable economy.
Intel shares fell 4% while Advanced Micro Devices Inc. / quotes/comstock/13 *! Amd / quotes / nls / AMD (AMD 6.80, -0.03, -0.44%) fell 8%.
In its statement, the Federal Open Market Committee acknowledged the U.S. economy For additional help, and that it would reinvest the profits from their investments in mortgage-backed securities as they mature in Treasury bills.
The S & P 500 / quotes/comstock/21z! I1: in \ x (SPX 1121, -6.73, -0.60%) lost 6.73 points, or 0.6%, to 1121.06, heavier by the technology sector, which fell 1.2%.
The Nasdaq Composite / quotes/comstock/10y! I: comp (COMP 2277, -28.52, -1.24%) lost 28.52 points, or 1.2%, to 2277.17.
Bond prices rose and the dollar pared its advance after the Fed announced its plan to stimulate the economy. Gold futures back above 1,200 an ounce in after hours trade.
Energy stocks will coldThe energy sector weighs heavily on the broader markets as oil futures decline. Cynthia Lin MarketWatch reports.
“The Fed is certainly concerned about the lack of growth of U.S. economy and therefore it has launched what is now called” quantitative easing 2.0 ‘, “wrote Kevin Giddis,anlyst at Morgan Keegan & Company Inc.
“We hope that after today, Congress will see that his action or inaction could be the difference between a slow recovery and a double-dip recession with deflation characteristics,” said Giddis.
Decliners outpaced advancers by about 3-to-1 on the New York Stock Exchange, where 980 million shares traded. Consolidated volume stood at 4.1 billion.
On Monday, the volume consolidated New York Stock Exchange was the slowest since New Year’s Eve, according to Peter Boockvar, equity strategist at Miller Tabak.
Before the Fed’s statement, U.S. stocks spent most of the session waiting to see if the central bank believes the economy needs more economic aid after reports illustrate the slowdown in growth in the country and in China.
The market decline was displaced as the feeling of speculation that the central bank and buy as much as $ 2 billion in bonds over the belief that it would take more modest measures, said John Brady, ananlyst at MF Global.
China’s trade data showed a sharp slowdown in the growth rate of imports. Read more about China’s economic data.
Internally, the Labor Department reported that productivity fell 0.9% in the second quarter, the Commerce Department reported that wholesale inventories rose just 0.4% in June.
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