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US stocks close mixed amid Fed meeting

US stocks close mixed amid Fed meeting
AFP
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First Published: Wed, Jun 24 2009. 08 47 AM IST
Updated: Wed, Jun 24 2009. 08 47 AM IST
New York: US stocks ended mixed on Tuesday as the Federal Reserve policy committee met to grapple with economic and financial concerns dogging the recession struck economy.
The Dow Jones Industrial Average fell 16.10 points, 0.19% to end at 8,322.91 a day after posting the largest one-day sell-off in two months.
The tech-dominant Nasdaq lost 1.27 points 0.07% to 1,764.92 while the broad-market Standard & Poor’s 500 rose 2.06 points, 0.23% to 895.10, still below the key 900 level which it fell into Monday for the first time since 28 May.
Uncertainty over the two-day Federal Reserve meeting as well as lower than expected home sales and Boeing’s delay of its maiden Dreamliner flight and delivery for the fifth time dampened market sentiment.
The Fed meeting injected “some uncertainty into market expectations,” said Scott Marcouiller, senior equity market strategist at Wells Fargo Advisors.
“The central bank is widely expected to keep the key rate near zero, but investors are not sure how optimistic the policymakers will be in their economic statement, which will be released tomorrow,” he said.
Any Fed comment may offer clues on the timing and strength of an economic recovery.
The Fed had taken radical measures to flood the system with money to prime the economy which has contracted since December 2007. The market is looking for signals from the Fed about how and when it would ease these measures.
Latest home sales figures added to market woes.
The National Association of Realtors said existing home sales for May came in at an annualized rate of 4.77 million units, slightly below the rate of 4.82 million units that was widely forecast.
Given that data for April was revised moderately lower to reflect an annualized rate of 4.66 million units, sales for May reflect a month-over-month increase of 2.4%, below the 3% increase that was widely expected.
“The data came in a bit below expectations and caused a knee-jerk selling effort,” analysts at Briefing.com said.
Among plunging stocks Tuesday was Dow heavyweight Boeing, which fell 6.46% to $43.87 after it announced a delay in the the first flight and delivery of its new 787 Dreamliner aircraft, the latest postponement in a program seen as a key to the aerospace giant’s future.
Plagued by problems from a complex international production system and a two-month machinists strike last year, the Dreamliner’s delays have irked customers and resulted in order cancellations.
United Airlines dropped 10.39% to $3.19 after it revealed plans to cut an additional 600 flight attendant jobs in response to slumping demand for travel due to a weak global economy.
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First Published: Wed, Jun 24 2009. 08 47 AM IST
More Topics: Stocks | US | Wall Street | DowJones | Fed |