Stocks End Sharply Lower After Fed Taper News
4:14 pm Wednesday, August 18th, 2021
Stocks fell after the Federal Reserve signaled that a decision on a reduction of its massive bond-buying program could happen in 2021. Treasuries and the dollar fluctuated.
To start, retailers Lowe’s (LOW), Target (TGT), and TJX Cos. (TJX) each beat earnings expectations, as did semiconductor company Analog Devices (ADI). LOW and TJX are the clear winners, TGT is down 1.7%, and ADI is up modestly.
Many of the retail stocks are bouncing back from yesterday’s declines, which were catalyzed in part by a weaker-than-expected retail sales report. Today’s economic data included weaker-than-expected housing starts for July and better-than-expected building permits for July.
Looking at the S&P 500 sectors shows nine of the 11 sectors trading lower, although the real estate sector (-1.1%) is the only sector down at least 1.0%. That indication reflects a lack of conviction in addition to relatively light trading volume at the NYSE.
The consumer discretionary (+0.8%) and communication services (+0.1%) sectors are trading in positive territory, with the former being supported by Lowe’s, TJX, and Tesla (TSLA). TSLA is seeing some relief from three straight days of losses.
In other developments, the HHS confirmed plans to offer booster COVID-19 shots for Americans, House Speaker Pelosi reportedly plans to move forward next week with the budget resolution vote, and the EIA reported a larger-than-expected weekly inventory draw.
