US stocks close lower after Fed minutes

New York: US stocks closed lower as investors awaited the release of a meeting minute from the Federal Reserve.

The Dow Jones Industrial Average on Wednesday lost 166.97 points, or 0.67 per cent, to 24,797.78. The S&P 500 decreased 14.93 points, or 0.55 per cent, to 2,701.33, Xinhua news agency reported.

The Nasdaq Composite Index was down 16.08 points, or 0.22 per cent, to 7,218.23.

The US central bank released the minutes from its January meeting on Wednesday. According to the minutes, the Fed officials see increased economic growth and an uptick in inflation as justification to continue to raise interest rates gradually.

After the news came out, the US 10-year Treasury yield spiked to as high as 2.956 per cent. Major stock indices rose sharply with the Dow jumping more than 300 points before paring gains completely.

On the economic front, US manufacturers reported a strong upturn in business conditions during February, which continued the positive trend seen at the start of this year.

The seasonally adjusted IHS Markit Flash US Manufacturing Purchasing Managers’ Index (PMI) rose to 55.9 in February from January’s 53.8, the fastest improvement in overall business conditions since October 2014.

Meanwhile, US home sales fell unexpectedly for a second consecutive month in January and experienced their largest decline on an annual basis over three years, according to the National Association of Realtors on Wednesday. All major regions saw monthly and annual sales declines last month.

The association said the existing home sales dropped 3.2 per cent to a seasonally adjusted annual rate of 5.38 million units last month.