By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) — U.S. stocks finished little changed Wednesday
after minutes from the last Federal Open Market Committee meeting showed
discussion of a third round of quantitative easing.
“We read something that happened a month ago and think the Fed is
thinking about quantitative easing. Yes, they were!” said Art Hogan, a
strategist at Lazard Capital Markets.
Since that meeting, the economic data have improved, which for Hogan negates the impression left by the Fed minutes.
“I don’t think you look at this and say they’ll definitely go or won’t;
it’s one more shade of gray,” said Scott Brown, chief economist at
Raymond James.
U.S. Markets Close Session Flat
Investors pared their losses but stocks remained broadly lower after minutes from the recent Federal Reserve meeting showed central-bank officials pushing for additional efforts to stimulate the economy. Paul Vigna has details on The News Hub.
After an 83-point fall, the Dow Jones Industrial Average
DJIA
-0.23%
lost 30.82 points, or 0.2%, at 13,172.76.
Fourteen of its 30 components lost ground, led by Hewlett-Packard Co.
HPQ
-4.79%
, which fell 3.7% ahead of its earnings report after the close.
Rival personal-computer maker Dell Inc.
DELL
-0.51%
slid 5.4% after reducing its profit forecast for the year.
Read more about Dell and H-P.
The S&P 500 index
SPX
+0.02%
rose 0.32 point to 1,413.49, with materials the best performer and industrials the worst of its 10 industry groups.
Sunrise Senior Living Inc.
SRZ
+59.69%
rallied after Health Care REIT
HCN
-2.69%
said it would buy the manager of retirement communities.
The Nasdaq Composite
COMP
+0.21%
rose 6.41 points, or 0.2%, to 3,073.67.
Decliners outpaced advancers roughly 2-to-1 on the New York Stock
Exchange, where 600 million shares traded. Composite volume topped 3
billion.
The U.S. dollar
DXY
-0.49%
fell against other currencies, including the euro
EURUSD
-0.01%
.
Read more on the currency markets.
Oil prices gained, with crude futures
CLV2
-0.03%
adding 42 cents to close at $97.26 a barrel.
Read more about oil trading.
Running on empty?
“The market is getting a little tired; it’s had a great run here over
the last few weeks and there are thoughts now as to whether Europe or
the Fed may disappoint,” said Andrew Fitzpatrick, director of
investments at Hinsdale Associates Inc.
“Some of the data is getting a little better, and it could cause the
chances of more Fed easing to decrease,” Fitzpatrick added, referring to
speculation that the Fed will embark on a third round of bond buying.
Randy Frederick, managing director of active trading and derivatives at
the Schwab Center for Financial Research, finds it difficult to fathom
that many market participants are still holding out hope for QE3, given
the recent strength in the market, the rise in interest rates and
improved economic reports. “There is no evidence or rationale for easing
at this point in time,” Frederick said.
Raymond James’s Brown believes whether Fed Chairman Ben Bernanke signals
another round of asset purchases by the Fed largely depends on economic
reports, which lately have been stronger.
“It raises the stakes for Bernanke’s Jackson Hole speech,” Brown said of
the annual event in Wyoming, where the Fed chief has in the past
delivered market-moving speeches. “We’re still definitely in recovery
mode; it’s not especially strong, but it’s not especially weak,” said
Brown.
Wednesday’s economic reports included data from the National Association
of Realtors, which said sales of existing homes rose 2.3% in July, in
line with expectations and illustrating an increase in activity in the
housing market.
Read more about the housing data.
In Europe, German Chancellor Angela Merkel and French President Francois
Hollande will meet Thursday to talk about the euro-area debt crisis,
with both planning to meet later in the week with Greece’s prime
minister.
Kate Gibson is a reporter for MarketWatch, based in New York.
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