U.S. stocks end lower after Fed minutes Private
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U.S. stocks end lower after Fed minutes
Private sector employers add 238,000 jobs in December , ADP reports
NEW YORK (MarketWatch) — U.S. stocks closed mostly lower on Wednesday after minutes from the last Federal Open Market Committee meeting showed that a majority of officials judged the effects of the monthly asset purchases to be diminishing over time.
Investors also pondered the implications of an upbeat private-sector jobs report that was released on Wednesday morning. The S&P 500 (SNC:SPX) closed down less than a point to 1,837.49. On Tuesday, the benchmark index recorded its first gain this year, snapping a three-day skid.
The Dow Jones Industrial Average (DJI
JIA) fell 68.20 points, or 0.4%, on Wednesday to 16,462.74, while the Nasdaq Composite (NASDAQ:COMP) rose 12.43 points, or 0.3%, to 4,165.61.
Federal Reserve officials agreed in December to scale back their asset-purchase program as most believed that the benefits of the controversial policy were eroding as time passed, according to minutes from their last meeting released Wednesday. By a 9-to-1 vote, the Fed on Dec. 18 decided to trim its asset-purchase program by $10 billion to $75 billion per month starting in January.
“What surprised us and other investors the most was the fact that the main reason behind the taper decision was not so much the improving economy, but what they saw as diminishing effects of the asset purchases,” said Chris Gaffney, senior market strategist at EverBank.
“The reaction was largely muted because markets have shifted their focus from tapering of the monetary stimulus back to the economy and earnings,” Gaffney said.
Automatic Data Processing said on Wednesday that private employers created 238,000 jobs in December, exceeding estimates. Economists polled by MarketWatch expected a gain of 215,000 jobs. Economists use ADP’s data to get a sense of the U.S. Labor Department’s employment report, which will be released Friday and covers government jobs in addition to the private sector. http://www.marketwatch.com/story/us-stocks-dr...=afterbell
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