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Wall Street Down for Second Consecutive Session Amid Renewed Fears of Taper

Wall Street slumped for the second straight session on Thursday, as investors were once again concerned about the possibility that the Federal Reserve’s reduction of stimulus spending,
Michael Teague is a staff writer for Equities.com. His previous experience includes three years as the associate editor of Los Angeles-based Al Jadid Magazine, a bi-annual review of the arts & culture of the Middle East, where he contributed many articles on the region in the form of features and book & film reviews. His educational background includes a BA in French literature from the University of California, Irvine, where he developed a startling proclivity for anything having to do with the 19th century.
Michael Teague is a staff writer for Equities.com. His previous experience includes three years as the associate editor of Los Angeles-based Al Jadid Magazine, a bi-annual review of the arts & culture of the Middle East, where he contributed many articles on the region in the form of features and book & film reviews. His educational background includes a BA in French literature from the University of California, Irvine, where he developed a startling proclivity for anything having to do with the 19th century.

Wall Street slumped for the second straight session on Thursday, as investors were once again concerned about the possibility that the Federal Reserve’s reduction of stimulus spending, otherwise known as “tapering”, could still arrive by the end of 2013, due to a statement after the previous day’s FOMC meeting which was considered to be slightly more hawkish than usual.

The Standard & Poor’s 500 index was off 0.38 percent to end at 1,756.54, while the Dow Jones Industrial Average was off nearly half of a percent to 15,545.75, and the Nasdaq was off by 0.28 percent to 3,919.71.

In another sign that first-time filings of jobless claims were kept artificially lower by the 16-day government shutdown, the Department of Labor reported that claims had fallen less than expected last week, down only 10,000 to 340,000 from the week before.

The Dow ended the day on the steepest losses thanks to Visa Inc (V) who ended the day over 3 percent lower after missing revenue expectations in its earnings report. The two biggest losers after that on the DJIA were also financials, with JPMorgan Chase & Co. (JPM) down 2 percent, and American Express Company (AXP) down just over 1.5 percent.

ExxonMobil (XOM) was the index’s biggest gainer on the day, advancing nearly 1 percent after its own earnings report saw the super-major’s first increase in output in over two years.

Financial stocks also weighed down the S&P 500, with insurer MetLife Inc. (MET) down over 3 percent on the day, along with Bank of America (BAC) and Citigroup Inc. (C) who were down on heavy trading. The worst loss by far however was sustained by multi-level marketing cosmetics firm Avon Products Inc. (AVP) , who posted huge misses on expectations for top and bottom lines in their Q3 earnings report. The stock was down almost 22 percent by the closing bell.

The poor performance of financial stocks was likely helped out by Goldman Sachs’ (GS) announcement that it would be cutting compensation for top-level executives by over 10 percent, in another sign that public and government pressure are being brought more fully to bear on the nation’s largest financial institutions.

On the NASDAQ, however, techs provided some support, with Facebook (FB) adding 2.45 percent by the close despite much consternation caused by the company’s CFO, who admitted during the previous evening’s earnings call with investors that the social media site was losing popularity with the key younger demographic.

Health care stocks also put in a good performance, with Oxygen Biotherapeutics (OXBT) gaining over 8 percent after a Duke University study confirmed that one of its cardiovascular treatments was effective. Amid much hand-wringing about the potentially disastrous consequences of the Affordable Care Act, it appears as though there are some interesting ways to play “Obamacare” through exchange traded funds.