Stocks Slip from Record Highs as Investors Digest Fed Direction
NEW YORK (TheStreet) -- U.S. stocks slipped on Thursday as investors processed a barrage of economic data a day after the S&P 500 reached new highs driven by the Federal Reserve's pledge to maintain its $85 billion a month bond-buying program pending stronger evidence of a healthy U.S. economy.
The Fed on Wednesday said it will maintain its current level of asset purchases given that the unemployment rate remains "elevated," mortgage rates have risen and economic growth appears still to be restrained.
Bank stocks tumbled led by JPMorgan Chase (JPM)after the country's bank was hit with$920 million in finesby regulators in the U.S. and the UK, stemming from its massive hedge-trading losses in 2012. Shares lost 1.2% to $52.75. Wells Fargo (WFC)lost 0.85% to $42.96 as the bank confirmed plans for 1,800 additional layoffsof mortgage production staff, according to a Bloomberg report.
Bank of America (BAC) fell 0.7% to $14.61.
Existing home sales rose to their highest level in six-and-a-half yearsin August as median prices rose nearly 15% year-on-year, defying expectations for a slowdown caused by rising interest rates. Also, the Philly Fed index of manufacturing activity surged to 22.3 in September, reversing the deceleration seen during the previous month and coming in above expectations of a rise up to 10.
Meanwhile, the Conference Board's Index of Leading Economic Indicators meanwhile showed a sharp rise in August following strong gains in July, marking a resumption of an upward trend after a brief pause. A rise in initial jobless claims during a non-farm payrolls survey week was reported by the Labor Department Thursday. Claims increased by 15,000 to 309,000 in the week of Sept. 14 after the prior week's figure was revised to 294,000 from 292,000 or what had been the lowest initial claims print since March 2006 thanks to state computer system upgrade that resulted in delayed claims processing. It's expected that the computer system upgrades will require a few more weeks to be completed. Agilent Technologies (A) was one of the top gainers in the S&P 500, surging 3.4% to $50.98 after saying it will split into two independent publicly-traded companies. One will be focused on life sciences, diagnostics and applied markets, retaining the Agilent name, and the other will be focused on electronic measurement, which will be named later. Tesla (TSLA) jumped 7.1% to $177.92 after an analyst raised his price target on the stock, citing better-than-expected margin expectations for the third quarter. Follow @atwtse -- Written by Andrea Tse in New York >To contact the writer of this article, click here: Andrea Tse.>
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