Closing Update: Stocks Snap 2-Day Winning Streak After Fed Points to End Of Stimulus Efforts


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Stocks fell Wednesday snapping two days of strong advances after Federal Reserve officials said stimulus efforts could end later this year, adding that interest rates could start rise as soon as six months after that. The Fed said job market conditions will largely drive its decision-making but it dropped a firm unemployment target from its policy strategy. Weak earnings by business software company Oracle ( ORCL ) and delivery carrier Federal Express also contributed to the downbeat mood. Energy and materials stock finished with the steepest declines, each falling nearly 1% as a group, closely followed by a drop for shares of consumer discretionary companies.

As expected, the Federal Open Markets Committee today trimmed another $10 billion from its monthly bond purchases but in a change from recent policy dropped its target for a 6.5% unemployment rate to trigger an increase in its benchmark borrowing rates. The central bank also scaled back it growth projections for the U.S. economy this year, now forecasting a rise of 2.8% to 3% in 2014, down from its previous call for 2.8% to 3.2% growth.

It was a very light for economic data, with only the Commerce Department reporting that the Q4 current account deficit which narrowed to a 14-year low of $81.1 billion during Q4 from a $96.4 billion deficit in the prior quarter. Market experts had been expecting an $86.5 billion deficit.

Commodities were mostly lower as the U.S. dollar rose following the FOMC meeting today. April crude oil fell 54 cents to $99.15 per barrel while April natural gas rose 3 cents to $4.49 per 1 million BTU. April gold was down $17.50 to $1,341.50 per ounche while May silver retreated 3 cents to $20.82 per ounce. May copper rose 4 to $2.99 per pound.

Here's where the markets stood at the end of the day:

Dow Jones Industrial Average down 114 (-0.7%) at 16,222

S&P 500 down 11.5 (-0.6%) at 1,860

Nasdaq Composite Index down 25.7 (-0.6%) at 4,307


Hang Seng Index down 0.07%

Shanghai China Composite Index up 0.17%

FTSE 100 Index down 0.46%


(+) HZNP, Climbs to to a new all-time high after announcing a deal to acquire privately held Vidara Therapeutics for $200 mln in cash and $400 mln of HZPN shares, which would give Vidara shareholders a 26% share of the combined companies.

(+) PRTA (+23.65%) Will present interim data from Phase 1 study of its NEOD001 drug candidate next month at the XIV International Symposium on Amyloidosis.

(+) NSPR (+4.42%) Successfully enrolled the first patient into the CARENET clinical trial.


(-) RBCN, The Co-Investment 2000 Fund LP and Cross Atlantic Technology Fund II LP late Tuesday file to sell 2.0 mln of their 5.02 mln shares overall in an underwritten secondary offering. RBCN will not receive any proceeds from the deal.

(-) AV, Reduced to Underperform from Neutral in a downgrade by BNP Paribas.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

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