Wall Street drops on Fed economic projectionsMay 21st, 2009 - 6:03 am ICT by IANS
New York, May 21 (DPA) Stocks fell on Wall Street in the last hour of trading as the Federal Reserve issued dreary economic projections for the rest of the year.
The Federal Open Market Committee said it anticipated a fourth-quarter contraction in the gross domestic product (GDP) of up to two percent, a drastic drop from the 1.3 percent it had projected in January.
And it said unemployment could reach 9.6 percent during the fourth quarter, compared to initial projections of a maximum of 8.8 percent. Current unemployment is 8.9 percent, the highest since 1983.
The projections were contained in the minutes of the committee’s April 28-29 meeting, which were released Wednesday.
The blue-chip Dow Jones Industrial Average slid 52.81 points, or 0.6 percent, to 8,422.04. The broader Standard & Poor’s 500 Index shed 4.66 points, or 0.5 percent, to 903.47. The technology-heavy Nasdaq Composite Index lost 6.70 points, or 0.4 percent, to 1,727.84.
The US currency fell against the euro to 72.67 euro cents from 73.37 euro cents on Tuesday. The dollar also dropped against the Japanese currency to 94.88 yen from 96.10 yen.
Tags: blue chip, contraction, dow jones, dow jones industrial, dow jones industrial average, dpa, drastic drop, economic projections, federal open market committee, federal reserve, fourth quarter, gdp, gross domestic product, initial projections, japanese currency, nasdaq composite index, open market committee, s 500, us currency, yen