The US stocks experienced decline on today and therefore the benchmark stock gauge, Standard & Poor’s 500 Index neared a 1-month low figure. Economists currently are predicting that the Federal Reserve will be reducing the stimulus as soon as next September. The benchmark stock gauge Standard & Poor’s 500 Index went down by 0.8% on today and the same is now at 1,627.93. The gauge therefore erased the earlier gains of around 0.4%. On the other hand, the Dow Jones Industrial Average declined by 111.57 points and the same is currently at 15,142.46. The overall trading volume at the companies listed under the S&P 500 Index was 6.6% higher in comparison with the average of the last 30 days.
The Investment strategist of Natixis Global Asset Management, David Lafferty, stated that he thinks that the equities are going to be more volatile in nature with all the different speculations of the tapering of the Federal Reserve. Apart from that, the growth environment has been slow as well and hence, as an investor, it is obvious to have more hiccups than one would otherwise have, in case of a strong growth phase.
Incidentally, the analysts at the different lenders such as Deutsche Bank AG and Goldman Sachs Group stated that the Federal Reserve could start the process of winding down the bond buying program right in this summer. The bond buying program, more popularly is known as quantitative easing.
According to a note published by the Chief Economist of Deutsche Bank Securities, Joseph A. LaVorgna, the Federal Reserve may cut around $25 million in purchases in this September and the split can be of $10 billion and $15 billion for mortgage backed securities and Treasuries respectively. On the other hand, the Chief Economist of Goldman Sachs, Jan Hatzius thinks that the Federal officials will wait till December before they slow down the monthly asset purchases worth $85 billion.
Among companies, Chevron Corp. declined by 1.1%. The fate was similar for other energy producers such as Exxon Mobil Corp. Apart from that, Salesforce.com Inc. shares went down by 5.5% as it stated that it will buy ExactTarget Inc. On the other hand, Dollar General Corp. experienced a tumble of 7.6% as it reduced the top end of the forecast of its full year earnings. General Motors Co. surged ahead by 1.6% as well.