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Neighbors Growing Together | Sep 2, 2014

Stocks slip

By Associated Press | Nov 07, 2013

NEW YORK — Stocks pulled back from record levels today as investors bet that faster growth in the U.S. would increase the likelihood that the Federal Reserve would slow down its economic stimulus program.

The U.S. economy expanded at an annual rate of 2.8 percent in the third quarter, up from 2.5 percent in the previous quarter. That made investors think the Fed could start cutting back its stimulus next month, earlier than many anticipated.

It “certainly raises the possibility of the Fed pulling back in December,” said Peter Cardillo, chief market economist at Rockwell Global Capital. “The Fed is going to test the water.”

The Fed is buying $85 billion of bonds a month to hold down interest rates and encourage hiring and borrowing. That has helped drive U.S. stock markets to record levels.

Twitter soared in its market debut. The stock was trading at $45.74, up 76 percent from its initial offering price of $26 a share.

The Dow Jones industrial average was down 27 points, or 0.2 percent, at 15,719 as of noon Eastern time. It was up as much as 50 points in early trading.

The Standard & Poor’s 500 index fell eight points, 0.5 percent, to 1,762. The Nasdaq composite lost 41 points, or 1.1 percent, to 3,890.

In government bond trading, the yield on the 10-year Treasury note fell to 2.61 percent from 2.64 percent a day earlier.

Oil fell 51 cents to $94.29 a barrel. The price of gold dropped $7.90 to $1,309 an ounce.

Among other stocks making big moves:

— J.C. Penney rose 35 cents, or 4.7 percent, to $8.06. The company said that a key sales barometer rose in October for the first time in nearly two years. The company’s stock is still down 60 percent this year.

— Whole Foods Market plunged $6.02, or 9.4 percent, to $58.45 after the company cut its outlook for sales growth and earnings for its next fiscal year.

— Qualcomm fell $2.46, or 3.5 percent, to $67.28 after the chip maker’s earnings fell short of Wall Street’s forecast.

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