This Time It's Office REITs: Financial Loser
NEW YORK (TheStreet) - Financial sector real estate investment trusts (REITs) continued to tumble, as Wall Street anticipates the Federal Reserve's withdrawal of support to stock and bond markets. This time, it was industrial and office REITs that fell the most, led by the over 6 % decline of Boston Properties
Boston Properties shares fell 6.45% in Thursday trading to $100.58, erasing the company's share price gains for 2013. Competitors Vornado
On Thursday, U.S. stock markets plunged the most in 19 months Thursday on fears that the Federal Reserve plans to reduce the bond-buying that has fueled equity markets for more than a year and kept mortgage rates at historic lows.
Major U.S. stock markets turned sharply lower on Wednesday as the Federal Open Market Committee voted to maintain its current policy of buying $85 billion per month by a vote of 10 in favor and 2 against but outlined criteria which will determine when the bank begins to reduce the size and scope of its bond buying program.
Fed Chairman Ben Bernanke stopped short of issuing a timeline but said that as the economy shows signs of improving, the bank will consider cutting back on the bond-buying that has helped to drive stocks.
Some financial sector heavyweights haven't suffered as much as REITs as investors increasingly price in the withdrawal of Fed support to asset prices.
The financial sector generally outperformed sharp market losses on Thursday, with REITs generally standing out as a pocket of weakness.
The financial sector fell 2.16%, while the S&P 500 dropped 2.5% to close at 1,588.19 as homebuilder stocks posted the biggest percentage losses in the index.
Money center commercial banks such as Citigroup