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US STOCKS-S&P 500 edges down after Fed minutes
January 8, 2014 / 7:55 PM / 4 years ago

US STOCKS-S&P 500 edges down after Fed minutes

* Strong ADP report boosts hopes for payrolls

* Minutes show Fed wanted cautious tapering approach

* Dow off 0.5 pct, S&P down 0.1 pct, Nasdaq up 0.3 pct

By Chuck Mikolajczak

NEW YORK, Jan 8 (Reuters) - The S&P 500 dipped on Wednesday as minutes from the U.S. Federal Reserve’s most recent meeting prompted little reaction from equity indexes, while Micron’s strong results helped boost the Nasdaq.

Minutes of the Fed’s Dec. 17-18 meeting, after which the U.S. central bank announced its decision to begin trimming its monthly bond purchases, showed Fed officials were careful to tread lightly as they embarked on the tapering process.

The Fed’s accommodative policies were the main driver of the S&P 500’s rally of nearly 30 percent in 2013. The program is expected to keep a floor under stock prices for as long as it continues.

“The financial markets really didn’t move at all, but typically history would suggest they need a little bit of time to just digest these things,” said Darrell Cronk, regional chief investment officer of Wells Fargo Private Bank in New York.

“What we need to recognize is since December 18, we’ve seen a significant improvement in the economic data. If we get a 200,000 or north jobs report on Friday, it increases the likelihood, along with that improving data, the Fed continues its tapering process at the January meeting.”

Earlier in the session, a report by ADP, a payrolls processor, showed U.S. private-sector employers added 238,000 jobs in December, more than expected and the best read since November 2012, while November 2013 numbers were revised higher.

The Dow Jones industrial average fell 85.17 points or 0.52 percent, to 16,445.77. The S&P 500 lost 1.90 points or 0.10 percent, to 1,835.98. The Nasdaq Composite added 11.567 points or 0.28 percent, to 4,164.749.

Micron Technology shares soared 9.1 percent to $23.72 to help lift the Nasdaq a day after the chipmaker reported higher-than-expected quarterly profits.

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