U.S. Stocks Slide Most in a Month as Gasoline, Crude Oil Retreat

Bloomberg (12/12) -- U.S. stocks fell the most in a month and Treasuries dropped as an agreement on a budget plan fueled speculation the Federal Reserve will be confident enough in the economy to reduce stimulus. Gasoline and oil slid while the yen and euro strengthened.

The Standard & Poor’s 500 Index slipped 1.1 percent to 1,782.22 at 4 p.m. in New York and the Stoxx Europe 600 Index lost 0.5 percent. Ten-year Treasury yields increased for the first time in four days. Oil retreated 1.1 percent to $97.44 a barrel after reaching a six-week high yesterday and gasoline decreased 0.7 percent to $2.6632 a gallon. The yen strengthened 0.4 percent to 102.43 per dollar, rebounding from a six-month low, and the euro advanced versus most major peers. American lawmakers announced a budget deal yesterday that would ease automatic spending cuts by about $63 billion over two years and reduce the deficit by $20 billion to $23 billion. The agreement comes after a report last week showed the jobless rate fell to a five-year low and more economists predicted the Fed will cut stimulus at its meeting next week. “Markets are increasing their views that we are a week or so away from tapering because of improving economic data and clearing the hurdle for a budget deal,” Jeffrey Kleintop, chief market strategist at LPL Financial LLC in Boston, said in a telephone interview. “This deal is great, it’s a positive, but also a negative because it could prompt the Fed to taper sooner.”