By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks declined modestly on
Wednesday after the Federal Reserve announced it would trim the
bond purchases by another $10 billion this month and changed the
way it targets unemployment and inflation in deciding short-term
interest rates.
The Fed said it will now consider a "wide range" of factors
instead of relying mainly on the unemployment rate. The Fed
statement also stressed that the bank could keep short-term rates
below what is viewed as "normal" even if employment levels and
inflation hit its targets.
The S&P 500 (SPX) fell 3 points, or 0.2%, to 1,869.25 after
the announcement. The Dow Jones Industrial Average (DJI) dropped 32
points, or 0.2%, to 16,300.45.
The Nasdaq Composite (RIXF) shed 9 points, or 0.2%, to
4,324.29.
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"The market didn't like what it heard from the Fed. I'm guessing
that it's the continuation of the taper -- even as the weather
we've had the past few months has clearly slowed the economy," said
Kimberly Caughey Forrest, senior equity analyst and vice-president,
Fort Pitt Capital Group.
Fed Chairwoman Yellen is holding her first news conference as
new Chairwoman at the end of the deliberations at 2:30 p.m.
Eastern. See also: Live blog and video of the Fed decision and the
Janet Yellen press conference.
Yields on 10-year Treasurys jumped, gold prices fell further and
the dollar spiked against the Yen after the Fed announcement.
Earlier, a batch of mixed earnings did little to influence
cautious sentiment.
Among individual stocks, shares in KB Home (KBH) jumped 8.8%
after the home maker swung to profit in its fiscal first quarter,
beating analysts estimates.
Shares of Oracle Corp. (ORCL) fell 1.3% after the
business-software group's adjusted profit and revenue growth wasn't
as strong as analysts had forecast.
FedEx Corp. (FDX) was little changed following the release of
its fiscal third-quarter earnings that fell short of Wall Street's
expectations. FedEx Corp. said severe winter weather dragged down
its earnings for the quarter ended Feb. 28.
General Mills Inc. (GIS) shares were 1.2% higher after the food
company reported quarterly profit mostly in line with
expectations.
In overseas markets, Asia had a mixed day, with the Nikkei 225
giving up a more than 1.2% gain at one point to close up just 0.4%,
while Chinese stocks went nowhere. European markets slipped, while
the FTSE 100 index rose after the release of minutes from the
latest Bank of England Monetary Policy meeting and the latest jobs
data. (GBPUSD)
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