Investing.com - U.S. stocks closed mixed on Wednesday after the Federal Reserve said monetary stimulus programs would stay in place for now. The announcement sent stocks rising initially, as stimulus measures are often bullish for equities, though investors sold for profits later in the rally.
At the close of U.S. trading, the Dow Jones Industrial Average finished down 0.14%, the S&P 500 index fell 0.01%, while the Nasdaq Composite index rose 0.27%.
The Federal Reserve said it would continue to buy USD85 billion in Treasury holdings and mortgage debt a month from banks to keep long-term interest rates low across the economy, a stimulus tool known as quantitative easing, which pumps up stock prices as a side effect.
"The committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes," the Fed said in a statement.
"The committee today reaffirmed its view that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens," the Fed added, which allowed the dollar to soften.
The statement ended uncertainty on Wall Street though gains were short lived on expectations that the U.S. central bank will begin tapering later this year, which could rekindle uncertainty as to how stocks will perform without Fed support albeit in an improving economy.
Elsewhere, the Bureau of Economic Analysis reported earlier that the U.S. gross domestic product grew at an annual rate of 1.7% in the three months to June, shooting past expectations for a 1.0% reading
The report showed personal consumption grew 1.8% in the second quarter, above expectations for 1.6%. Consumer spending typically accounts for nearly 70% of U.S. economic growth.
Separately, payroll processing firm ADP said non-farm private employers created 200,000 jobs in July, above expectations for an increase of 180,000.
Data also showed that the Chicago purchasing managers' index rose less than expected in July, hitting 52.3 from 51.6 in June. Analysts had expected the index to rise to 54.0 for July.
Leading Dow Jones Industrial Average performers included Walt Disney, up 0.84%, UnitedHealth Group, up 0.82%, and JPMorgan Chase, up 0.78%.
The Dow Jones Industrial Average's worst performers included American Express, down 1.86%, Verizon Communications, down 1.80%, and Pfizer, down 1.38%.
European indices, meanwhile, finished higher.
After the close of European trade, the EURO STOXX 50 rose 0.32%, France's CAC 40 rose 0.15%, while Germany's DAX 30 finished up 0.06%. Meanwhile, in the U.K. the FTSE 100 finished up 0.76%.
At the close of U.S. trading, the Dow Jones Industrial Average finished down 0.14%, the S&P 500 index fell 0.01%, while the Nasdaq Composite index rose 0.27%.
The Federal Reserve said it would continue to buy USD85 billion in Treasury holdings and mortgage debt a month from banks to keep long-term interest rates low across the economy, a stimulus tool known as quantitative easing, which pumps up stock prices as a side effect.
"The committee is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation as the outlook for the labor market or inflation changes," the Fed said in a statement.
"The committee today reaffirmed its view that a highly accommodative stance of monetary policy will remain appropriate for a considerable time after the asset purchase program ends and the economic recovery strengthens," the Fed added, which allowed the dollar to soften.
The statement ended uncertainty on Wall Street though gains were short lived on expectations that the U.S. central bank will begin tapering later this year, which could rekindle uncertainty as to how stocks will perform without Fed support albeit in an improving economy.
Elsewhere, the Bureau of Economic Analysis reported earlier that the U.S. gross domestic product grew at an annual rate of 1.7% in the three months to June, shooting past expectations for a 1.0% reading
The report showed personal consumption grew 1.8% in the second quarter, above expectations for 1.6%. Consumer spending typically accounts for nearly 70% of U.S. economic growth.
Separately, payroll processing firm ADP said non-farm private employers created 200,000 jobs in July, above expectations for an increase of 180,000.
Data also showed that the Chicago purchasing managers' index rose less than expected in July, hitting 52.3 from 51.6 in June. Analysts had expected the index to rise to 54.0 for July.
Leading Dow Jones Industrial Average performers included Walt Disney, up 0.84%, UnitedHealth Group, up 0.82%, and JPMorgan Chase, up 0.78%.
The Dow Jones Industrial Average's worst performers included American Express, down 1.86%, Verizon Communications, down 1.80%, and Pfizer, down 1.38%.
European indices, meanwhile, finished higher.
After the close of European trade, the EURO STOXX 50 rose 0.32%, France's CAC 40 rose 0.15%, while Germany's DAX 30 finished up 0.06%. Meanwhile, in the U.K. the FTSE 100 finished up 0.76%.