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US stocks fall as Federal Reserve retains bond buying program

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October 30
8:38 PM 2013

Stocks in the US took a plunge even as the US central bank said it would continue with its monthly bond purchases. Bloomberg reported that LinkedIn Corp fell 9.3% after its quarterly sales forecast did not jibe with forecasts from analysts. A 12% fall was experienced by Western Union Co which said that regulatory compliance expenses would not allow operating profit to increase in 2014. The S&P 500 also dropped 0.5%, breaking its four-day increase. The Dow Jones also fell 0.4% today.

The Federal Reserve's move, however, fueled speculation that tapering could happen in the next months. Bloomberg reported that the central bank had taken out a sentence on its prior policy statement which mentioned that stricter financial conditions could slow economic improvement.

However, a Reuters report said economists were still betting that the stimulus would remain even into 2014. Oppenheimer Funds Chief Investment Officer Rishna Memani told Reuters, "Until the economic data strengthens, and strengthens meaningfully, I think expectations for tapering are going to remain subdued. The likelihood of anything happening in December is modest."

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