Business Briefs: Market drop worst in months

Business Briefs: Market drop worst in months

August 16th, 2013 by Staff Reports and Associated Press in Business Around the Region

Stock market tile

Stock market tile

Photo by Associated Press /Times Free Press.

Market drop worst in months

Grim sales forecasts from two major companies and concern that the Federal Reserve will soon start withdrawing its support for the economy pummeled the stock market Thursday.

The Dow Jones industrial average slumped 225 points, its worst day in nearly two months. Investors also dumped bonds, driving the yield on the 10-year Treasury note to its highest level in more than two years.

The Dow fell 225.47 points, or 1.5 percent, to 15,112.19. Wal-Mart and Cisco Systems, both of which are in the Dow, disappointed investors with poor sales forecasts. Wal-Mart fell 2.6 percent, Cisco fell 7.2 percent.

The Standard & Poor's 500 index dropped 24.07 points, or 1.4 percent, to 1,661.32.

Mortgage rates remain low

Average rates on U.S. long-term fixed mortgages remained steady for a second straight week, giving prospective home buyers more time to lock in historically low levels.

Mortgage buyer Freddie Mac said Thursday that the average rate on the 30-year loan remained unchanged at 4.4 percent this week. That is a full percentage point higher than in early May, when rates neared record lows.

The average on the 15-year fixed loan edged up to 3.44 percent from 3.43 percent.

Mortgage rates have risen from near-record lows in May amid anticipation that the Federal Reserve may begin reducing its bond purchases at next month's policy meeting.