U.S. Stocks Retreat Before Federal Reserve Beige Book
The Standard & Poor’s 500 Index lost 0.2 percent to 1,360.37 at 9:31 a.m. in New York. The Dow Jones Industrial Average dropped 47.75 points, or 0.4 percent, to 12,757.79 today. The S&P 500 rose 0.7 percent yesterday as Fed Chairman Ben S. Bernanke told senators the central bank is prepared to act to boost the economy if the labor market doesn’t improve.
“Intel’s announcement is confirmation of what we’re seeing and that’s slowing economic growth,” Kevin Caron, a market strategist in Florham Park, New Jersey, at Stifel Nicolaus & Co., which has more than $120 billion in client assets, said in a telephone interview.
Bernanke will deliver the second part of his semi-annual testimony on the economy and monetary policy to the House Financial Services Committee at 10 a.m. today. The Fed will release its Beige Book today, two weeks before the Federal Open Market Committee meets to set monetary policy. The U.S. economy was described as growing at a “moderate pace” in the Fed’s June Beige Book survey.
Intel slid 0.9 percent to $25.15. The world’s largest semiconductor maker scaled back its annual sales forecast as personal-computer demand fails to rebound among consumers in the U.S. and Europe.
Revenue will rise 3 percent to 5 percent in 2012, the company said in a statement yesterday. That was lower than an earlier projection for a gain at a percentage in the high single digits. Santa Clara, California-based Intel posted $54 billion in sales last year, and analysts on average estimated growth of 4.8 percent, according to data compiled by Bloomberg
Yahoo! Inc. (YHOO) lost 0.3 percent to $15.55. The biggest U.S. Web portal said second-quarter revenue, excluding sales passed on to partner sites, rose less than 1 percent to $1.08 billion. That compares with the $1.1 billion average analysts’ projection compiled by Bloomberg.
Stocks declined even after a report showed U.S. housing starts rose more than forecast in June to the fastest rate in almost four years, indicating a brighter outlook for the residential real estate market. Starts rose 6.9 percent last month to a 760,000 annual pace after a revised 711,000 rate in May that was faster than initially estimated, Commerce Department data showed. The median forecast of economists surveyed by Bloomberg News called for a 745,000 rate.
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