US stocks decline for 3rd day on taper speculation
Traders work on the floor of the New York Stock Exchange on Thursday, Dec. 12, 2013. US stocks Thursday closed lower after a surprisingly good retail sales report boosted speculation that the US Federal Reserve could soon scale back its stimulus program. AP
NEW YORK—US stocks Thursday closed lower after a surprisingly good retail sales report boosted speculation that the US Federal Reserve could soon scale back its stimulus program.
The Dow Jones Industrial Average fell 104.10 points (0.66 percent) to 15,739.43.
The broad-based S&P 500 declined 6.72 (0.38 percent) to 1,775.50, while the tech-rich Nasdaq Composite Index gave up 5.41 (0.14 percent) at 3,998.40
Thursday marked the third straight day of losses after strong gains throughout the year.
Peter Cardillo, director of investment research at Rockwell Global Capital, attributed the decline to a November retail sales report, which showed growth of 0.7 percent, above the 0.6 percent expected by analysts.
“The market is positioning itself for a very possible tapering announcement at next week’s” Federal Reserve meeting, Cardillo said.
“They have all the evidence needed to act.”
The retail sales data follows better economic reports on growth and unemployment, Cardillo said. These reports have fostered speculation the Fed might taper its $85 billion a month bond-buying program at its policy meeting that wraps up Wednesday.
Hotel chain Hilton Worldwide made a successful return to the stock market, gaining 7.5 percent to $21.50 on its first day of trading following its IPO price of $20.
Social networking company Twitter advanced 5.7 percent after it unveiled a new form of online advertising through its MoPub platform.
Twitter’s rival, Facebook, also scored, rising 5.0 percent after the S&P 500 announced the company would be added to the prestigious index after the close of trade Friday.
Technology company Oracle fell 2.8 percent after RBC Capital slashed its rating to “sector perform” from “outperform,” citing tough competition from other cloud computing vendors and spending concerns in China. Morgan Stanley also downgraded Oracle due to uncertain growth prospects.
Women’s sports attire chain Lululemon Athletica dived 11.7 percent after issuing a disappointing profit forecast for the fourth quarter. Lululemon projected profits of 78-80 cents per share, below the 84 cents seen by analysts.
General Motors fell 0.3 percent after announcing it was selling its remaining stakes in Ally Financial and French automaker PSA Peugeot Citroen.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.88 percent from 2.84 percent Wednesday, while the 30-year increased to 3.90 percent from 3.88 percent. Bond prices and yields move inversely.
