May 22, 2013 / 7:12 PM / 7 years ago

US STOCKS-Wall St declines as FOMC minutes raise concern over Fed tapering

* FOMC minutes show members open to tapering, disagreement on conditions

* Bernanke touts benefits of Fed easing, but hints could act

* Stocks down after hitting highs earlier

* Dow off 0.4 pct, S&P off 0.7 pct, Nasdaq off 1 pct

By Angela Moon

NEW YORK, May 22 (Reuters) - U.S. stocks fell on Wednesday with a selloff accelerating in late afternoon trade, after minutes from the latest U.S. Federal Reserve meeting showed some officials were open to tapering large-scale asset purchases as early as at the June meeting.

The minutes followed comments from Chairman Ben Bernanke who said the Fed could decide to scale back the pace of bond purchases at one of the “next few meetings” if the economic recovery looked set to maintain forward momentum.

The comments were a blow to a market that was accelerating during the morning, with indexes rising more than 1 percent after Bernanke said the central bank needed to see further signs of traction in the economy before it tapered stimulus efforts.

“This is a very sensitive market and particularly sensitive to any notion that tapering will come too soon,” said Quincy Krosby, market strategist at Prudential Financial in New York.

“No one wants to be selling if the data reaches the point when the Fed begins to specifically talk about tapering. The market doesn’t wait for the Fed to move. It will move before. That’s how it operates.”

Krosby also added that Bernanke went off-script and in his effort to be transparent, “he confused the market.”

According to the minutes of the April 30-May 1 policy meeting released on Wednesday, “a number” of officials were open to tapering large-scale asset purchases as early as the June meeting, but disagreement continued on what conditions would suffice to begin that move.

One official preferred to begin decreasing purchases immediately and another wanted to add more accommodation immediately, but ultimately most felt it was important simply to be prepared to adjust the pace up or down in response to incoming data.

Investors have increasingly turned their attention to when the Fed’s current $85 billion-per-month bond purchase program might end or slow. The stimulus has been a major force behind a rally in U.S. equities that has helped the S&P 500 and Dow industrials gain about 16 percent so far this year.

The Dow Jones industrial average was down 60.69 points, or 0.39 percent, at 15,326.89. The Standard & Poor’s 500 Index was down 12.36 points, or 0.74 percent, at 1,656.80. The Nasdaq Composite Index was down 36.57 points, or 1.04 percent, at 3,465.55.

Technology and commodity stocks were among the top decliners. On the S&P, the info technology sector was off 1 percent while the energy sector lost 1.4 pe4rcent.

Among individual stocks, Pfizer shares were up 2.1 percent to $29.39 after the giant drug maker said it would unwind its remaining stake in animal health business Zoetis .

Shares of luxury department store chain Saks Inc jumped 14.6 percent to $15.66 after the New York Post, citing a source briefed on the matter, reported that Saks had hired Goldman Sachs to explore strategic alternatives that include a possible sale.

Target Corp cited unseasonably cold weather as it reported a 0.6 percent decline in first-quarter sales at U.S. stores open at least a year. Target cut its full-year profit forecast and shares slid 4.9 percent to $67.80.

Toll Brothers shares rose 3.1 percent to $37.13 after the largest U.S. luxury homebuilder posted a 46 percent rise in quarterly profit, suggesting the housing recovery is picking up pace across the industry.

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