By Sinead Carew
(Reuters) - U.S. stocks turned negative on Wednesday afternoon after meeting minutes showed that the Federal Reserve sees a change in its bond investment policy later this year, which reversed a rally after a strong jobs report earlier in the day.
Most Federal Reserve policymakers think the central bank should take steps to begin trimming its $4.5 trillion balance sheet later this year as long as the economic data holds up, minutes released at 2pm ET showed.
"A little bit of the optimism has ebbed out of the market," due to the additional signs of monetary policy tightening, according to Chris Zaccarelli, Chief Investment Officer, at Cornerstone Financial Partners, in Huntersville, North Carolina.
The Nasdaq biotechnology index <.NBI> turned negative shortly after the minutes, likely because investors turned away from riskier investments after the news, according to Zaccarelli. The biotech index was last down 0.94 percent.
At 3:25PM ET, the Dow Jones Industrial Average <.DJI> was down 6.34 points, or 0.03 percent, to 20,682.9, the S&P 500 <.SPX> had lost 3.71 points, or 0.16 percent, to 2,356.45 and the Nasdaq Composite <.IXIC> had dropped 22.86 points, or 0.39 percent, to 5,875.75.
Declining issues outnumbered advancing ones on the NYSE by a 1.25-to-1 ratio; on Nasdaq, a 1.78-to-1 ratio favoured decliners.
The S&P 500 posted 38 new 52-week highs and 4 new lows; the Nasdaq Composite recorded 71 new highs and 52 new lows.
Brian Battle, director of trading at Performance Trust Capital Partners in Chicago also said the late afternoon selloff was related to the Fed minutes and the comment that the Fed sees a change to its reinvestment policy as likely to be appropriate.
(Additional reporting by Rodrigo Campos in New York, Yashaswini Swamynathan in Bengaluru; Editing by James Dalgleish and Nick Zieminski)
Disclaimer: No Business Standard Journalist was involved in creation of this content
