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U.S. stocks open lower on Fed jitters; Dow Jones down 0.14%

Published 12/10/2013, 09:45 AM
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Investing.com - U.S. stocks opened lower on Tuesday, as expectations the Federal Reserve could soon begin scaling back its stimulus program weighed on U.S. equities ahead of the central bank's policy meeting next week.

During early U.S. trade, the Dow Jones Industrial Average fell 0.14%, the S&P 500 index slipped 0.14%, while the Nasdaq Composite index edged down 0.08%.

Expectations that the Fed could begin rolling back its stimulus program as soon as next week were boosted after the latest U.S. nonfarm payrolls report showed that the U.S. economy added more jobs than expected in November, pushing the unemployment rate down to a five year low of 7.0%.

On Monday, St. Louis Fed President James Bullard said the prospect of tapering was more likely in the near future due to improvement in the labor market.

American Airlines Group slid 0.37% a day after the U.S. Supreme Court declined to grant a stay that would have blocked the merger of American Airlines parent AMR and U.S. Airways.

Sysco shares plummeted 2.60%, after soaring over 9% on Monday, as the food-distribution company said it would pay about USD3.5 billion and take on about USD4.7 billion in debt to acquire competitor US Foods to form a company with about USD65 billion in annual revenue.

Elsewhere, General Motors was down 0.24% after naming Mary Barra to succeed Dan Akerson as chief executive officer, making her the first female head of the automaker.

The decision came after the Treasury late Monday said the U.S. government had sold its final stake in GM, which had to be rescued at the height of the global financial crisis.

In similar news, Lululemon Athletica, up 0.78%, said founder Chip Wilson will step down as chairman to be replaced by Michael Casey, lead director of the board.

Among tech companies, Texas Instruments forecast fourth-quarter sales and profit in line with analysts’ predictions, thanks to higher demand for car components. Shares in the company still fell 0.34% at the open of the U.S. trading session.

Across the Atlantic, European stock markets were sharply lower. The EURO STOXX 50 tumbled 0.98%, France’s CAC 40 declined 0.87%, Germany's DAX lost 1.08%, while Britain's FTSE 100 shed 0.47%.

In a speech on Tuesday, European Central Bank President Mario Draghi urged governments to complete a banking union, saying it was crucial at both a national and European level.

During the Asian trading session, Hong Kong's Hang Seng Index slipped 0.28%, while Japan’s Nikkei 225 Index fell 0.25%.


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