Investing.com - U.S. stocks closed lower Wednesday, as investors were disappointed that only a few FOMC members believe further stimulus is needed, while concerns over the handling of the euro zone’s debt crisis continued to weigh.
At the close of U.S. trade, the Dow Jones Industrial Average fell 0.38%, the S&P 500 index closed lower fractionally while the Nasdaq Composite index dropped 0.53%.
Stock traders were disappointed with the outcome of the FOMC meeting minutes revealing that only a small minority of FOMC members favored additional stimulus measures.
Market sentiment remained vulnerable after Germany’s Constitutional Court delayed on Tuesday its decision on whether the euro zone's bailout fund, the European Stability Mechanism, is compatible with German law.
Without German backing, the ESM, which was originally meant to start on July 1, then delayed to July 9, cannot come into effect.
Meanwhile, Spanish Prime Minister Mariano Rajoy announced EUR65 billion of new austerity measures, in an effort to meet new budget-deficit targets agreed with euro zone partners. Market analysts warned that the fresh austerity measures were likely to drag Spain’s economy deeper in to a recession.
In the U.S., official data showed earlier that the trade deficit narrowed to USD48.7 billion in May from deficit of USD50.6 billion in April, whose figure was revised from a deficit of USD50.1 billion. Analysts had expected the U.S. trade deficit to narrow to USD48.5 billion.
In company news, Goldcorp saw shares dive 9.63% after the gold producer cut its full year guidance for production levels. The company cited reduced output at mines in Ontario and in Mexico.
Meanwhile, Yahoo edged down 0.06% as the search for the Internet company’s new CEO continued. Interim CEO Ross Levinsohn was said to be the leading candidate for the job.
In the tech sector, Applied Materials saw shares dropp 0.93% after the chip-equipment maker said on Tuesday that it expects to miss its full-year estimates and its third-quarter results will be at the low end of its previous outlook.
On the upside, Research In Motion jumped 1.86%, a day after the BlackBerry maker's shareholders elected the company's slate of directors at its annual meeting.
Elsewhere, financial stocks were mixed. Shares in Citigroup climbed 1.31% and JP Morgan advanced 0.85%, while Bank of America rose 0.13% and Goldman Sachs eased 0.04%.
HSBC Holdings surged 1.01% after Bloomberg reported that the bank was to apologize at a July 17 U.S. Senate hearing for anti-money laundering controls that weren’t effective enough.
Europe’s largest bank was to be questioned by U.S. lawmakers about two weeks after a record fine was levied against Barclays for rigging interest rates and its ex-CEO Robert Diamond testified in the U.K.
Other stocks in focus included Marriott and Texas Instruments, both slated to release second quarter earnings after the closing bell.
At the close of European trade, the EURO STOXX 50 rose 0.20%, France’s CAC 40 declined 0.57%, while Germany’s DAX 30 advanced 0.24%.
nvestors are anticipating Chinese GDP, U.S. initial jobless claims and Federal Budget numbers along with a chat by ECB President Mario Draghi on Thursday.