NEW YORK — U.S. stocks and Treasury prices dropped Tuesday after Federal Reserve policymakers said they were worried about a slowdown in hiring and appeared to resist buying more bonds to help the economy.
The Dow Jones industrial average was down as much as 133 points after the Fed released minutes of the March meeting of its Open Market Committee, which sets interest rates and monetary policy. It had been down 45 points before the minutes were released.
The Fed minutes — which said the central bankers “generally agreed that the economic outlook, while a bit stronger overall, was broadly similar to that at the time of their January meeting” — were also to be expected.
“Most of the economic data we’ve seen have been positive; that would be less reason to support more stimulus,” said Chip Cobb, portfolio manager at Bryn Mawr Trust. “Overall, I think people were looking for a reason to finally take some profits. But I think this is short term. This is not the catalyst that is going to push us down 15 percent. I would say (the Fed) was a deflator for the day, and we’ll regroup by the end of the week.”
The Dow closed down 64.94 points, or 0.5 percent, at 13,199.55. The Standard & Poor’s 500 index fell 5.66 points to 1,413.38. The Nasdaq composite index dropped 6.13 to 3,113.57. It was the fifth loss for the Nasdaq in six trading sessions, but the index remains up almost 20 percent for the year, compared with 12 percent for the S&P.
Utility stocks barely rose. The other nine industry groups that make up the S&P 500 fell, led by energy stocks, which declined about 1 percent.
The Fed minutes showed that policymakers fear that hiring could slow if economic growth doesn’t improve. The country added an average of 245,000 jobs per month from December through February, the strongest three months since the Great Recession.
Only two of 10 voting committee members on the Fed committee said they would support another round of bond purchases, and only if the economy weakened significantly.
“Everybody would like a little more stimulus,” James Dunigan, chief investment officer in Philadelphia for PNC Wealth Management, said in a telephone interview. “It reiterates what the chairman has been saying, that they saw continuously moderate economic growth and they stand ready to do something, but at the moment there’s no immediate need to do any additional stimulus.”
