Utilities lose the most among 10 major sectors
U.S. stocks ended with big losses on Friday, 20 September 2013 on Friday, as investors reacted to the uncertain science of reading verbal signals from U.S. central bankers. Sellers remained in control throughout the day amid divisive headlines from Washington. In addition, participants heard from two Fed officials whose remarks reflected quite a bit of static on the Fed's open line of communication with the market.
During a morning interview St. Louis Fed President James Bullard said the Fed could taper at its October meeting, but added that the current low rates of inflation suggest the central bank should be patient in its assessment of Quantitative Easing. Meanwhile, Kansas City Fed President Esther George expressed some disenchantment that the Fed did not taper at the September meeting despite believing the markets were ready.
The Dow Jones Industrial Average fell 185.46 points, or 1.2%, to 15,451.09. The Nasdaq Composite shed 14.66 points, or 0.4%, to 3,774.73. The S&P 500 index dropped 12.43 points, or 0.7%, to 1,709.91, with utilities losing the most of its 10 major sectors.
Aluminum-producer Alcoa was one of the top three decliners among the Dow's 30 components, its shares down 1.8% on its final day of trading as a blue chip.
Alcoa, Hewlett-Packard and Bank of America will no longer be part of the Dow 30 when trading begins Monday, replaced by Goldman Sachs, Visa and Nike.
Also Read
Another Dow component, Caterpillar fell 3.4% after the heavy-equipment maker in a regulatory filing reported a decline in retail sales.
Among major stocks under focus, Apple shares fell 1% as long lines formed at the iPhone maker's retail stores around the globe, with the latest models of its handsets on sale, starting Friday. Blackberry plunged 17.1% after cutting its second quarter guidance well-below consensus estimates. The company also announced plans to cut its global workforce by 40%.
The rally for gold and silver came to a halt on Friday, 20 September 2013 with prices losing more than half of their gains from a day earlier, but still ending higher for the week. Precious metals on Friday gave up roughly half of the gains made this week following the surprise announcement from the Federal Reserve that it will maintain the current pace of its asset-purchasing program.
The December gold dropped $36.80, or 2.7%, to settle at $1,332.50 an ounce on the Comex division of the New York Mercantile Exchange. Futures prices rose 1.8% for the week. Silver prices on Friday led the percentage losses among the major Comex metals. December silver fell $1.37, or 5.9%, to end at $21.93 an ounce, but saw a weekly gain of 1%.
Friday's drop was a logical reaction to the big jump in gold after the surprise Federal Reserve Open Market Committee decision to stick to the central bank's bond-buying program.
During the week, India, traditionally a big buyer of gold and silver dampened the mood for precious metals after hiking its key interest rate unexpectedly to 7.5%. Gold imports have been sliding in India since the government has been on a campaign this summer to curb them. The government blames a huge deficit and a weak rupee on the country's insatiable appetite for gold.
Crude-oil futures lost $1.72, or 1.6%, to $104.67 a barrel and gold futures dropped $36.80, or 2.7%, to $1,332.50 an ounce on the New York Mercantile Exchange.
For every stock rising, nearly three declined on the New York Stock Exchange, where nearly 2.1 billion shares traded. Composite volume topped 5 billion.
There is no economic data scheduled to be reported on Monday, but global markets will be reacting to the results of the German federal election.
Powered by Capital Market - Live News