- Title: Wall Street closes lower, ending rally on Afghanistan, Fed concerns
- Date: 26th August 2021
- Summary: GARDEN CITY, NEW YORK, UNITED STATES (AUGUST 26, 2021) (REUTERS) (SOUNDBITE) (English) PATRICK FRUZZETTI, PARTNER, ROSE ADVISORS AT HIGHTOWER, SAYING: "I honestly doubt he'll provide any roadmap. I think, you know, there is still a concern about the Delta variant. I still don't think they fully understand what the effects of it will be. They may for now want to stick to their current schedule of QE taper. I mean ultimately if they execute upon that schedule, I think it'll be a painful yet brief experience that they'll learn from. But honestly, we'll see what they ultimately do, because I think the Fed really seems to think they have much more runway to tighten than they actually do."
- Embargoed: 9th September 2021 21:14
- Keywords: Federal Reserve economy equities interest rates markets tapering
- Location: NEW YORK + GARDEN CITY, NEW YORK, UNITED STATES
- City: NEW YORK + GARDEN CITY, NEW YORK, UNITED STATES
- Country: US
- Topics: Economic Events,Equities Markets,United States
- Reuters ID: LVA002ERX4FGN
- Aspect Ratio: 16:9
- Story Text: Wall Street lost ground on Thursday (August 26), ending a streak of all-time closing highs on concerns over developments in Afghanistan, while fears of a potential shift in U.S. Federal Reserve policy prompted a broad but shallow sell-off the day before the Jackson Hole Symposium.
All three major U.S. stock indexes ended the session modestly lower, with the S&P and the Nasdaq notching their first down day in six.
The sell-off firmed after hawkish commentary from Dallas Fed President Robert Kaplan and a blast outside the Kabul airport in Afghanistan helped strengthen the risk-off sentiment.
Kaplan, who is not currently a voting member of the Federal Open Markets Committee, said he believes the progress of economic recovery warrants tapering of the Fed's asset purchases to commence in October or shortly thereafter.
Kaplan's remarks followed earlier comments from the St. Louis Fed President James Bullard, who said that the central bank is "coalescing" around a plan to begin tapering process.
The economy grew at a slightly faster pace than originally reported in the second quarter, fully recovering its losses from the most abrupt downturn in U.S. history, according to the Commerce Department. But jobless claims, though still on a downward trajectory, ticked higher last week.
The data did little to move the needle with respect to expectations that the Fed is unlikely tip its hand regarding the taper timeline when Chairman Jerome Powell unmutes and delivers his speech at Friday's virtual Jackson Hole Symposium.
Unofficially, the Dow Jones Industrial Average fell 191.2 points, or 0.54%, to 35,214.3, the S&P 500 lost 26.27 points, or 0.58%, to 4,469.92 and the Nasdaq Composite dropped 96.88 points, or 0.64%, to 14,944.98.
(Production: Fred Katayama, Hyeongmi Kim, Soren Larson)
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