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 Minutes of the Fed's December 17-18 meeting, after which the U.S.
central bank announced its decision to begin trimming its monthly
bond purchases, showed Fed officials were careful to tread lightly
as they embarked on the tapering process.
The Fed's accommodative policies were the main driver of the S&P
500's rally of nearly 30 percent in 2013. The program is expected to
keep a floor under stock prices for as long as it continues.
"The financial markets really didn't move at all, but typically
history would suggest they need a little bit of time to just digest
these things," said Darrell Cronk, regional chief investment officer
of Wells Fargo Private Bank in New York.
"What we need to recognize is since December 18, we've seen a
significant improvement in the economic data. If we get a 200,000 or
north jobs report on Friday, it increases the likelihood, along with
that improving data, the Fed continues its tapering process at the
January meeting."
Earlier in the session, a report by ADP, a payrolls processor,
showed U.S. private-sector employers added 238,000 jobs in December,
more than expected and the best read since November 2012, while
November 2013 numbers were revised higher.
The Dow Jones industrial average <.DJI> fell 68.20 points or 0.41
percent, to end at 16,462.74. The S&P 500 <.SPX> dipped just 0.39 of
a point, or 0.02 percent, to finish at 1,837.49. The Nasdaq
Composite <.IXIC> rose 12.43 points or 0.30 percent, to close at
4,165.611.
The S&P 500 has fallen 0.6 percent over the first five sessions of
the year. According to the January effect watched by some market
participants, the first month dictates the stock market's fortunes
for the year — and the first five trading days are important in
determining the outcome.
However, Credit Suisse data shows that any month, except October,
could be used to determine the market's momentum 11 months ahead
more than 50 percent of the time.
Micron Technology <MU.O> shares soared 9.9 percent to close at
$23.87 and helped bolster the Nasdaq a day after the chipmaker
reported higher-than-expected quarterly profits.
Microsoft <MSFT.O> shares slid 1.8 percent to $35.76, pressuring the
Dow. Microsoft is closer to naming a new chief executive officer,
according to a source familiar with the board's thinking, but it
lost a front-runner candidate on Tuesday when Ford's <F.N> CEO Alan
Mulally said he would not be going to the software giant.
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Ford's stock rose 1 percent to end at $15.54.
Shares of JC Penney Co Inc <JCP.N> plunged 10 percent to close at
$7.37 after the department store chain said on Wednesday that it was
"pleased" with its holiday season sales without giving specific
results. That prompted many on Wall Street to say the retailer's
sales may have declined last month.
Apollo Education Group Inc <APOL.O> shares jumped 14.2 percent to
$30.76 after the owner of the University of Phoenix reported a
quarterly profit well ahead of Wall Street expectations.
The pharmaceutical sector remained a hotbed for mergers and
acquisitions. Forest Laboratories <FRX.N> agreed to buy privately
held specialty pharmaceutical company Aptalis Holdings Inc for about
$2.9 billion. Forest Labs' stock surged 17.9 percent to $69.30 and
ranked as the S&P 500's biggest gainer.
NuPathe Inc <PATH.O> leaped 35.6 percent to $4.38 after the company
said it received a buyout offer from Israel's Teva Pharmaceutical
Industries Ltd <TEVA.TA><TEVA.N> for $114 million plus milestone
payments related to NuPathe's migraine treatment. Teva's U.S.-listed
shares shed 0.4 percent to $41.05.
Volume was modest, with about 6.05 billion shares traded on U.S.
exchanges, slightly below the 6.19 billion average so far this
month, according to data from BATS Global Markets.
Declining stocks outnumbered advancing ones on the New York Stock
Exchange by a ratio of 17 to 13, while on the Nasdaq, 13 stocks fell
for every 12 that rose.
(Editing by Jan Paschal)
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