Indexes Down After FedEx Gives A Glum Outlook
Most retail stocks fell. Target fell 41 cents to $64 and Bed Bath & Beyond gave up $1.73, or 2.5 percent, to $69.04.
Markets had rallied sharply last week after the Federal Reserve announced aggressive measures intended to kick-start the economy. This week, investors have been more focused on the weak growth that caused the Fed to act in the first place.
The Fed's announcement was for open-ended asset purchases with no set ending time, noted Charlie Smith, chief investment officer for Fort Pitt Capital Group in Pittsburgh.
"The feeling on the Street is, 'OK, what can they do next?' and by definition there's nothing more they can do than what they announced," he said. That means investors may feel that they've gotten all of the gains they're going to get after the Fed's announcement, he said.Also on Tuesday, the Commerce Department reported that the current account deficit dropped 12.1 percent in the second quarter. That's down from a record high in the January-through-March quarter. The deficit shrank because of an increase in American exports and cheaper oil. But economists are predicting it will grow again because of the global slowdown. Oil prices fell 63 cents to $95.99 per barrel on the New York Mercantile Exchange. Oil had hit $100 per barrel in recent days but dropped $4 per barrel in late trading Monday. The drop looked like a trading glitch at first, but with prices continuing lower on Tuesday it began to look more like a legitimate sell-off as concerns about the lethargic economy persisted. Stocks fell in Europe, too. The CAC-40 in France was down 1 percent, the FTSE-100 in Britain fell 0.4 percent, and the DAX in Germany was down 0.8 percent. The yield on the 10-year U.S. Treasury note fell to 1.79 percent from 1.84 percent late Monday.
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