U.S. stocks declined as Federal Reserve Chair Janet Yellen signaled the economy is nearly ready for higher borrowing costs, while the scale of the European Central Bank’s additional stimulus measures disappointed some investors.
Equities fell to a two-week low and are headed toward year end with their smallest move in four years. Investors are grappling with an array of influences, including divergent policies from major central banks, uneven economic data and turbulence in commodities markets. Energy shares weighed Thursday for a second session, despite a rebound in oil prices.
The Standard & Poor’s 500 Index fell 0.8 percent to 2,063.80 at 12:47 p.m. in New York, following a 1.1 percent slide yesterday. The Dow Jones Industrial Average lost 112.84 points, or 0.6 percent, to 17,616.84. The Nasdaq Composite Index declined 0.9 percent.
Yellen delivered a cautiously upbeat outlook for the U.S. economy, signaling the conditions necessary for an interest-rate increase have been met and that she hopes to tighten monetary policy slowly after liftoff. “I currently judge that U.S. economic growth is likely to be sufficient over the next year or two to result in further improvement in the labor market,” Yellen said, according to the text of testimony Thursday before Congress’s Joint Economic Committee.
Source : Bloomberg