US stocks decline, finishing the week in the red
US stocks declined today following a downgrade from the IMF regarding the US and its economic stability for next year. The downgrade came as a bitter blow and all but wiped out the gains made on the back of Standard & Poor’s improved outlook for the US which was announced on Monday when the credit agency upgraded the worlds largest economy to an AA+ rating.
The S&P 500 declined by 0.6 percent for the day, ending the week’s trading at 1626.73 — a decline of 1 percent for the week. The US markets are still on edge due to Ben Bernanke’s comments almost a month ago regarding the scaling back of the Federal Reserve’s monetary stimulus package. The central bank has been buying $85bn worth of bonds a month since November, spurring the longest and most consistent rally of the decade so far.
Eric Thorne of Bryn Mawr Trust Co told Bloomberg “All eyes are on the Fed in terms of what policy might be like three to six months from now,” and then added “The Fed is unlikely to step in with any kind of potential damper. The fundamentals are improving, but the markets have improved so much quickly that we may need to see some consolidation, some sideways movement in the market before the next major uptrend.”
Time Warner Cable lead the index, climbing 8.09 percent after CNBC announced that the Internet Service Provider had declined the opportunity to merge with Charter Communications Inc. Gamestop advanced by 3.94 percent on the back of Microsoft and Sony making their announcements regarding the next generation of gaming consoles. Gamestop was expected to struggle in the long term due to a changes in the way consoles handle pre-owned games, however Sony announced that their Playstation 4 will not be adopting this new approach to digital rights management.