NEW YORK (AP) — Differing signals from the Federal Reserve are confusing the financial markets.
Prices surged early today on congressional testimony by Fed chairman Ben Bernanke suggesting the central bank would not end its massive economic stimulus program any time soon. But then minutes of a Fed meeting were released suggesting the stimulus could be scaled back as early as next month if the economy picks up, and stocks began dropping fast.
The Fed minutes showed that some policymakers favored tapering a bond-buying program. That prompted traders to dump U.S. government bonds, sending their interest rates, or yields, higher.
The Dow Jones industrial average ended the day down 80 points, or 0.5 percent, to 15,307. Earlier, the index had risen as much as 154 points after Bernanke started speaking to lawmakers.
The Standard and Poor's 500 fell nearly 14 points to 1,655. a decline of 0.8 percent. And the Nasdaq composite was down nearly 39 points at 3,463, or 1 percent.
