U.S. stocks declined for a third straight session on Monday as Federal Reserve officials suggested the Fed could still begin scaling back its stimulus later this year. A looming political deadline in Washington added to pressure on the market, where losses over the past three sessions have erased the S&P 500's 1.2 percent gain last Wednesday when the Fed decided against reducing its economic stimulus measures. William Dudley, president of the Federal Reserve Bank of New York, said in a speech the timeline that Fed Chairman Ben Bernanke articulated in June for scaling back the central bank's stimulus measures is "still very much intact," as long as the economy keeps improving. At a separate event, Dallas Fed President Richard Fisher warned that by standing pat the Fed had hurt its credibility and said he had urged colleagues to support a $10 billion reduction in the Fed's bond-buying program at last week's meeting. Banks led the S&P 500's decline, with Citigroup (C.N) down 3.2 percent at $49.57, a day after the Financial Times reported Citi had a significant drop in trading revenue during the third quarter. The S&P financial index .SPSY lost 1.5 percent. Shares of JPMorgan Chase (JPM.N) were down 2.5 percent at $51.46. The Fed last week decided against reducing asset purchases from the current $85-billion monthly pace, surprising many investors who had anticipated a change in policy. "They have cast uncertainty, and the uncertainty more than overshadows the fact that they've left a more stimulative policy in place," said Stephen Massocca, managing director at Wedbush Equity Management LLC in San Francisco. The Dow Jones industrial average .DJI was down 49.71 points, or 0.32 percent, at 15,401.38. The Standard & Poor's 500 Index .SPX was down 8.07 points, or 0.47 percent, at 1,701.84. The Nasdaq Composite Index .IXIC was down 9.44 points, or 0.25 percent, at 3,765.29. The S&P 500 is on track for a gain of 4.2 percent for September and is up 19.3 percent for the year so far. Adding to concerns was the approaching Oct 1 deadline for Congress to avoid a government shutdown as lawmakers negotiate ahead of the end of the fiscal year. "I think investors are a little more concerned about the debate going on in Washington and the volatility that may create over the next few weeks," said Michael Sheldon, chief market strategist of RDM Financial in Westport, Connecticut. U.S.-listed shares of Blackberry (BBRY.O) closed up 1.1 percent at $8.82 after a consortium led by Fairfax Financial offered to buy the Canadian smartphone maker for $4.7 billion. Apple (AAPL.O) shares were a bright spot, up 5 percent to $490.64, giving the S&P 500 its biggest boost. Apple sold 9 million iPhone 5s and iPhone 5c models since their launch on Friday. A flood of new orders gave a boost to European and Chinese firms in September, according to surveys that added to evidence that the global economy is healing, but U.S. factory activity lost some momentum. The widely followed Dow Jones industrial average .DJI now includes three new components. Goldman Sachs (GS.N), Visa (V.N) and Nike (NKE.N) on Monday replaced Bank of America (BAC.N), Hewlett-Packard (HPQ.N) and Alcoa (AA.N). Shares of Goldman fell 2.7 percent to $165.25, while Visa declined 1.3 percent to $196.24, and Nike dipped 0.6 percent to $68.98. HP eased 0.1 percent to $21.20, Alcoa slipped 0.1 percent to $8.28 and shares of Bank of America dropped 2.1 percent to $14.14. Volume totaled about 5.8 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, below the average daily closing volume of about 6.3 billion this year. Source : Reuters
