US shares close lower; telecoms dip two percent

Stocks closed lower on August 16 as investors waited for minutes of Federal Reserve meeting held in July to be published. Telecommunications noticeably lagged. The events were interpreted by Randy Frederick of Charles Schwab as a result of investors engaged in a little bit of profit taking. Another possible reason could be due to the result of the Fed minutes yet to be published for mass consumption. He added that he believes that the impact will not be a major one, but will get a reaction nevertheless. 

All three big indexes closed at peak highs at the same time for second time in a week on August 15. The indexes posted their record closes simulatenously for first time since more than a decade before-in 1999.

Losses at Dow Jones Industrial average ended approximately 80 points down, which extended losses prior to the close. The biggest contributor to these losses is the Johnsom & Joghnson company. This made other business analysts like JJ Kinahan of TD Ameritrade to put forward the notion that this event is more than simple profit taking. He clarified that the dip is not caused by the broad based selling of stocks. On the contrary, stocks are sold strategically. Bruce Bittles of Baird put forward the opinion that the market was overbrought a little and the lowering of stock value is simply a small correction. There was a dip of 0.55 percent at the S&P 500. Telecommunications went down by approximately two percent. 

Analysts like Kim Forrest of Fort Pitt capital brushed away any notions of this event being a negative one. He said that the sequence of events showed it as a simply profit taking one. The Nasdaq on its part closed about 0.7 percent.

According to Jeremy Klein of FBN Securities, equities all over the world are at present showing a little bit of weakness and there is volatility in the FX market and in the rates as well. This makes a perfect excuse for some investors to make a quick profit. Similar views were held by Art Hogan of Wunderlich Securities. He said that a trifecta was achieved yesterday, and that makes it an excellent reason for an investor to cash in a little. He added on to say that the size of the move was not a large one and it is probably a consolidation move on the investors’ part.

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