In Congressional testimony on Wednesday, Federal Reserve
Chairman Ben Bernanke said that the central bank could begin
winding down its $85 billion-per-month bond-buying program at one
of its "next few meetings."
Minutes from the May FOMC meeting, however, showed that there
is no consensus about when to begin pulling back on the stimulus.
The decision will likely be significantly influenced by the
trajectory of the economy in coming months.
The comments spooked investors who have been enjoying a near
continuous rally in in U.S. stocks in 2013. The major averages
fell throughout much of the session and closed near their worst
The Dow Jones Industrial Average lost 80 points, or 0.52
percent, to 15,307.
The S&P 500 fell 14 points, or 0.83 percent, to 1,655.
The Nasdaq shed almost 39 points, or 1.11 percent, to
Existing Home Sales
Home sales improved slightly in April, rising to 4.97 million
from 4.94 million in March. Nevertheless, this came in below
consensus expectations calling for an increase to 4.98
Crude oil prices fell along with the stock market on
Wednesday. Late in the day, NYMEX crude futures were down around
2 percent to $94.20. Brent crude futures had lost 1.35 percent to
$102.51. Natural gas was last trading down 0.14 percent to
Precious metals also fell along with the market. Heading into
the close of equities, COMEX gold futures were down 1.35 percent
to $1,359.00. Silver contracts had lost a little less than 1
percent to $22.25. Copper futures were last up 0.51 percent on
The grain complex was higher across the board on the session.
At last check, corn futures were trading up almost 3 percent
while wheat had added 1.18 percent. Movers in soft commodities
included coffee, which fell more than 3 percent, and orange
juice, which rose a little more than 2 percent.
Late in the day, the iShares Barclays 20+ Year Treasury Bond
) was down around 1.50 percent to $116.09. The steep fall in bond
prices pushed yields higher on the session.
The 2-Year Note yield was last up one basis point to 0.24
percent. The yield on the 5-Year Note surged seven basis points
to 0.89 percent on the day.
The 10-Year Note yield and 30-Year Bond yield added ten and
eight basis points to 2.03 percent and 3.21 percent,
The U.S. dollar rose on Wednesday. Near the close of the stock
market the PowerShares DB US Dollar Index Bullish ETF (NYSE:
), which tracks the performance of the greenback versus a basket
of foreign currencies, was up 0.48 percent to $22.90.
The closely watched EUR/USD pair fell 0.35 percent to $1.2865.
The only other significant mover on the day was the AUD/USD,
which lost 0.64 percent.
Volatility and Volume
The CBOE Volatility Index (VIX) rose on the day as markets
fell. The gains, however, were limited and volatility
expectations remain low. Late in the day, the VIX was trading up
a little better than 5 percent to 14.07.
Volume was very heavy on the session as investors reacted to
comments made by the Fed chief. Around 210 million SPDR S&P
500 ETF (NYSE:
) shares traded hands compared to a 3-month daily average of 124
) climbed almost 14 percent on the session after a poster on
Seeking Alpha argued that the biotech firm is a ripe takeover
Retailer Saks (NYSE:
) jumped almost 14 percent near the close after the company hired
Goldman Sachs to explore potential strategic alternatives,
including a sale.
Shares of Booz Allen Hamilton (NYSE:
) jumped almost 8 percent after the company's fiscal
fourth-quarter earnings results.
) climbed almost 23 percent on Wednesday after the company
reported a surprise profit in its fiscal third-quarter.
Bristol Myers Squibb (NYSE:
) climbed around 5 percent after analysts at Citigroup upgraded
the stock to Buy and raised their price target.
) plunged around 14 percent on Wednesday after the company agreed
to acquire N-able Technologies for $120 million.
Infinity Pharmaceuticals (NASDAQ:
) lost 8 percent on the day. The volatility in the share price
does not appear to have been linked to any significant news.
Shares of CVR Partners LP (NYSE:
) fell almost 9 percent late in the day after a public share
offering priced at a discount to Tuesday's closing price.
AMAG Pharmaceuticals (NASDAQ:
) lost almost 11 percent on the session after the company said
its distributor has recalled a batch of ferumoxytol, an iron
deficiency treatment, after a death in Switzerland.
Chinese internet company YY Inc. (NASDAQ:
) fell almost 17 percent on the session, although the reason for
the move was not readily apparent. The stock had been surging in
recent days and the correction was likely due to profit
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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