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Very little mystery about what sent stocks lower today, August 18.

As of 2:10 p.m. New York time the Dow Jones Industrial Average was essentially flat for the day with a tick down of just 0.05%.

By 2:16, after the release of minutes from the Federal Reserve’s July 28 meeting the index had dropped to a loss of 0.44% on the day. The downward trend continued to the close with the Dow off 1.08% on the day (or 382 points) and the Standard & Poor’s 500 lower by 1.07%. The NASDAQ Composite was down 0.89% and the NASDAQ 100 closed off 0.97%. The small cap Russell 2000 index lost 0.84%. The iShares MSCI Emerging Markets ETF (EEM) gained a scant 0.16%.

So what in the minutes spooked stocks?

The minutes showed that most Federal Reserve officials agreed that they could start slowing the pace of bond purchases later this year. “Various participants commented that economic and financial conditions would likely warrant a reduction in coming months,” minutes of the Federal Open Market Committee’s July 27-28 gathering, said. The minutes also showed that most participants “judged that it could be appropriate to start reducing the pace of asset purchases this year.”

The minutes raised the odds that the Federal Reserve will actually announce a policy change either at the August 26 to 28 Jackson Hole central bankers confab or at September 22 meeting of the Fed’s Open Market Committee.

The yield on the 10-year Treasury dropped a mere 1 basis point today as bond prices were essentially unchanged. One worry I’d flag is the possibility that the bond market will stage–again–a taper tantrum (which caused a big drop in stock prices last time around) in an effort to convince the Federal Reserve that any change in monetary policy is too dangerous right now.

The timing of any reduction in bond purchases remained up in the air, the minutes suggested, with some officials saying that in the minutes “it could be appropriate to start reducing the pace of asset purchases this year.” Other participants at the July meeting pointed to 2022 for starting a reduction in purchases. Some of those speaking in favor of starting a reduction in purchases this year suggested that the reduction could be wrapped up by the summer of 2022.

The Fed minutes and the market reaction to them produced more hedging on the S&P 500. The CBOE S&P 500 Volatility Index (VIX) rose 17.4% to 21.03.