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U.S stocks drop in volatile session on Fed murkiness; Dow down 0.84%

Stock MarketsJun 12, 2013 04:23PM ET
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This article has already been saved in your Saved Items - U.S. stocks fell on Wednesday in another volatile session marked by uncertainty over whether the Federal Reserve may scale back stimulus measures.

Monetary stimulus tools such as the Fed's USD85 billion monthly bond-buying program flood the economy with liquidity to spur recovery and keep borrowing costs low, a combination that sends stock prices rising as a side effect.

A lack of economic indicators and no second-quarter earnings reports due until July left investors with little to use as a weather vane, which fueled sentiments that volatility may be here to stay for a while.

At the close of U.S. trading, the Dow Jones Industrial Average finished down 0.84%, the S&P 500 index ended down 0.84% as well, while the Nasdaq Composite index fell 1.06%.

Wednesday marked the first three-day losing streak for Dow Jones Industrial Average in 2013.

A Bank of Japan decision earlier this week to leave monetary policy unchanged after months of rolling out stimulus measures continued to roil markets on Wednesday but fanning uncertainty as to whether the Federal Reserve will follow suit.

Stocks rose in early trading though they quickly wiped out gains due to discomforting swings in currency markets.

The Fed has kept interest rates low since the recession and has rolled out three rounds of bond-buying in recent years to prop up the economy, and uncertainty as to whether the U.S. central bank will begin to taper its stimulus programs sent stocks on a wild ride, especially with no major economic indicators hitting the wire.

Leading Dow Jones Industrial Average performers included Hewlett-Packard, up 2.76%, Microsoft, up 0.43%, and Pfizer, up 0.07%.

The Dow Jones Industrial Average's worst performers included American Express, down 2.35%, Home Depot, down 1.55%, and IBM, down 1.36%.

European indices, meanwhile, finished lower.

After the close of European trade, the EURO STOXX 50 fell 0.62%, France's CAC 40 fell 0.44%, while Germany's DAX 30 finished down 0.96%. Meanwhile, in the U.K. the FTSE 100 finished down 0.64%.

On Thursday, investors will trade on U.S. retail sales and weekly jobless claims figures.

U.S stocks drop in volatile session on Fed murkiness; Dow down 0.84%

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