TOCKS slipped yesterday, a day after a record close on the S&P 500, with traders looking ahead to next week’s Federal Reserve meeting in the absence of market-moving economic data.
Healthcare stocks were among the most active after company news while utilities was the worst performer of the 10 industry groups on the S&P 500.
The S&P 500 held above key technical indicators including its 14-day moving average, and volume remained below average even for a thinly-traded month.
“It’s a bit of consolidation after a run-up to new highs. There’s no reason to think this is anything different than that,” said Paul Zemsky of ING Investment Management.
A number of Fed policymakers suggested on Monday that it may be closer than previously thought to trimming its $85bn a month in bond purchases. But stronger economic data of late, including a drop in the unemployment rate to a five-year low, helped ease investors’ angst over a stimulus pull-back.
“Monetary policy responds to changes in the economy and as long as the economy is better, tapering shouldn't be too difficult to endure,” said Kevin Caron, market strategist at Stifel, Nicolaus & Co.
The Fed’s policy-setting Federal Open Market Committee meets Tuesday and Wednesday next week.
The Dow Jones industrial average fell 52.4 points or 0.33 per cent, to close at 15,973.13 last night.
The S&P 500 lost 5.75 points or 0.32 per cent, to finish at 1,802.62 and the Nasdaq Composite dropped 8.261 points or 0.2 per cent, to 4,060.49.