US stocks keep sliding on weak data, Fed qualms

Published on NewsOK Modified: February 21, 2013 at 3:35 pm •  Published: February 21, 2013
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"Everybody's gotten a 2 percent pay cut, and people who file their taxes early are not getting a refund back in a timely manner," Forrest said.

Supermarket chain Safeway was the biggest gainer in the S&P 500, rising $2.84, or 14.1 percent, to $22.97 after saying its net income jumped 13 percent in the fourth quarter, helped by higher gift and prepaid card revenue.

Electric car company Tesla Motors plunged a day after reporting that its fourth-quarter net loss grew 10 percent on costs related to production of its new Model S. The stock fell $3.38, or 8.8 percent, to $35.16.

Earlier, Asian stocks had closed sharply lower. The sell-off began Wednesday afternoon in New York after the release of minutes from the Fed's latest meeting. The meeting notes showed that some policymakers want to wind down bond purchases and other measures aimed at boosting the economy.

The minutes revealed new divisions over the Fed's low-interest rate policies. There is no sign of inflation, yet there was more evidence that some Fed officials are ready to ease off the stimulus programs before the economy has fully recovered.

The Fed's bond-buying has been boosting markets by reducing the cost of borrowing for companies and investors, Forrest explained. When interest rates are lower, it's possible to do business cheaper even if a company isn't growing, she said.

"Thinking maybe interest rates will creep higher, this is a very chilling scenario" for the market, she said.

The yield on the 10-year Treasury note fell to 1.98 percent from 2.05 percent early Wednesday as demand increased for ultra-safe assets.

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Daniel Wagner can be reached at www.twitter.com/wagnerreports.



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