Despite falling for a third consecutive day, the stock market is holding up reasonably well amid speculation that the Federal Reserve may start rolling back its economic stimulus efforts.
The Dow Jones industrial average were 54.98 points, or 0.35%, to 15,463.76 in midday trading. It was part of a broad decline in U.S. share prices that followed overnight losses in foreign markets, especially in Britain and Japan. Stocks tumbled 4% in Japan.
The selling has come amid extremely light trading activity, even when measured by the relaxed standards of the summer when much of Wall Street is on vacation. Average daily trading volume on the New York Stock Exchange last month was 1.4 billion shares, down 16% from a year ago.
This week's selling has been stoked by signals that the Federal Reserve may rein in its $85-billion-a-month bond-buying program sooner than expected.
Charles Evans, the head of the Federal Reserve Bank of Chicago, hinted that a so-called tapering of the bond buying could begin as soon as next month because of the economy’s clear improvement.
Stocks fell sharply in June after Fed officials suggested a so-called tapering of the bond buying, which many investors credit with spurring the sluggish U.S. economy and pushing up share prices.
Despite similar hints now, the current sell-off has been relatively muted, with the Dow off less than 1.5% from its record peak last Friday.