Agence France-Presse
7:12 am | Wednesday, December 4th, 2013
Specialists Joe Parisi, left, and Michael Cacace work at a post on the floor of the New York Stock Exchange Tuesday, Dec. 3, 2013. US stocks Tuesday fell for a second day in a row as speculation increased that the US Federal Reserve will soon scale back its bond-buying program. AP PHOTO/RICHARD DREW
NEW YORK—US stocks Tuesday fell for a second day in a row as speculation increased that the US Federal Reserve will soon scale back its bond-buying program.
The Dow Jones Industrial Average fell 94.15 points (0.59 percent) to 15,914.62.
The broad-based S&P 500 dipped 5.75 (0.32 percent) to 1,795.15, while the tech-rich Nasdaq Composite Index declined 8.06 (0.20 percent) to 4,037.20.
The sell-off came as investors focused on prospects that the Fed may trim its $85 billion per month bond-buying program earlier than previously believed, perhaps at its monetary policy meeting in two weeks.
That speculation picked up following strong economic data on Monday, a dearth of major economic news on Tuesday and ahead of a big US labor report Friday that many feel could hasten Fed action if jobs growth is strong.
The markets are falling because of “more taper fears” as economic data improves, said Brent Schutte of BMO Private Bank.
Dow component Pfizer fell 1.9 percent after Goldman Sachs removed it from its “conviction buy” list. Goldman said it sees less upside for Pfizer in light of its rise in value, Barrons.com reported.
GM reported a 14 percent rise in November auto sales, yet shares fell 2.5 percent. Rival automaker Ford posted its best November performance since 2004, but shares declined 2.9 percent.
Technology giant Apple jumped 2.7 percent following a Wall Street Journal report that it acquired social media analytics firm Topsy Labs for more than $200 million. Separately, a Jefferies note cited anecdotal evidence that suggested Apple had a “great” Black Friday weekend.
Electric-car company Tesla Motors soared 16.5 percent after it reported that German authorities had cleared it in a safety probe. Separately, Morgan Stanley said the US upstart is its “top pick” among 26 names in the US auto sector.
Fast-food chain Yum Brands lost 2.7 percent after reporting a one percent increase in same-store sales in China, but noting that the increase was fueled in part by a one-time promotion at its Kentucky Fried Chicken chain. The company pledged a “strong bounceback” in 2014 “following a year that is clearly below our high expectations.”
Bond prices rose. The yield on the 10-year US Treasury dipped to 2.78 percent from 2.80 percent Monday, while the 30-year declined to 3.84 percent from 3.86 percent. Bond prices and yields move inversely.
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