US stocks have closed lower after the US Federal Reserve maintained an aggressive monetary stimulus program and reiterated that it will await stronger economic conditions before scaling it back.
The Dow Jones Industrial Average on Wednesday fell 61.59 (0.39 per cent) to 15,618.76.
The broad-based S&P 500 declined 8.64 (0.49 per cent) to 1,763.31, while the tech-rich Nasdaq Composite Index gave up 21.72 (0.55 per cent) at 3,930.62.
The Fed’s decision to hold steady on its $US85 billion per-month bond-buying program, though bullish for stocks, was widely anticipated and had helped propel the Dow and S&P 500 to records on Tuesday.
Analysts said the markets were due for a break.
“It’s just a case of profit taking,” said William Lynch, director of investment for Hinsdale Associates.
The market “has been so strong that it’s been due for a breather.”
US auto giant General Motors powered 3.2 per cent higher after earnings excluding special items bested expectations by three cents at 96 cents per share. The company reported better results in North America and a narrowed loss in Europe.
Video game developer Electronic Arts jumped 7.8 per cent after reporting earnings of 33 cents per share, more than double the 12 cents expected by analysts. The company also raised its earnings forecast.
Pharmaceutical company Gilead Sciences jumped 4.6 per cent after earnings rose 17 per cent to $US788.6 million and the company raised its revenue forecast and plans for research and development spending. Sales of antiviral products were particularly strong.
Money transfer firm Western Union sank 12.4 per cent after announcing that it expects operating profit growth to stall in 2014 due to significantly higher regulatory costs.
Internet networking site LinkedIn sank 9.3 per cent after the company’s fourth-quarter revenue forecast of $US415-$420 million lagged analyst forecasts of $US438.1 million.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.53 per cent from 2.51 per cent on Tuesday, while the 30-year edged higher to 3.63 per cent from 3.62 per cent. Bond prices and yields move inversely.
