US STOCKS-Wall St down in volatile trading after Fed minutes


US STOCKS * Energy shares lead decline as oil futures tank

* Indexes down: Dow 0.95 pct, S&P 0.89 pct, Nasdaq 0.85 pct (Updates prices, changes comments, byline)

By Rodrigo Campos

Aug 19 (Reuters) – U.S. stocks fell in choppy trading on Wednesday as minutes from the July Federal Reserve meeting confounded traders’ expectations of an interest rate hike.

Major indexes had fallen more than 1 percent in late morning trading but the Nasdaq and Dow industrials briefly turned positive after release of the Fed minutes.US STOCKS Utilities stocks, sought for their comparable high returns and stability when Treasury yields are seen weakening, were the only S&P 500 sector in positive territory. The minutes showed policymakers continued to express broad concerns about lagging inflation and the weak world economy even as the job market continued to improve.

“The Fed seemed to express concerns that international developments would weigh more on the inflation outlook than the economic outlook,” said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management in Menomonee Falls, Wisconsin. “This could incline the Fed to wait to hike.”

Energy stocks posted the most losses on the S&P 500 as crude fell 4.3 percent for the day, even as the U.S. dollar also weakened after a somewhat dovish read on the minutes.

The Dow Jones industrial average fell 165.62 points, or 0.95 percent, to 17,345.72, the S&P 500 lost 18.59 points, or 0.89 percent, to 2,078.33 and the Nasdaq Composite dropped 43.08 points, or 0.85 percent, to 5,016.27.

The Fed said “recent decreases in oil prices and the possibility of adverse spillovers from slower economic growth in China raised some concerns” among officials.

China devalued its currency nearly two weeks after the Fed meeting in a move seen as an attempt to energize exporters, while U.S. oil futures have fallen roughly 17 percent since July 29, the second day of the Fed meeting.

Materials stocks fell more than 1 percent as copper slid to a six-year low on persistent concerns about slowing growth in China.

Declining issues outnumbered advancing ones on the NYSE by 2,242 to 759, for a 2.95-to-1 ratio on the downside; on the Nasdaq, 1,928 issues fell and 838 advanced, for a 2.30-to-1 ratio favoring decliners.

The S&P 500 was posting 20 new 52-week highs and 28 new lows; the Nasdaq was recording 30 new highs and 123 new lows



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