Wall Street erased gains and fell on Wednesday following the U.S. Federal Reserve didn’t satisfy investors dreaming about a stronger sign it could scale back future rate of interest hikes.
In a widely expected decision, the Fed kept interest rates unchanged also it said it was “closely monitoring” global economic and financial developments, however it maintained an otherwise upbeat view of the U.S. economy.
“Markets around the world do not think it was prudent for that Fed to boost rates last month,” said Adam Sarhan, CEO of Sarhan Capital. “The fact that the Fed has become starting to raise rates clearly shows you they’re disconnected from what is actually happening on the ground.”
Major stock indexes reversed earlier gains and moved lower.
The Dow Jones industrial average fell 222.77 points, or 1.38 percent, to fifteen,944.46, the S&P 500 lost 20.66 points, or 1.09 percent, to at least one,882.97 and the Nasdaq Composite dropped 99.51 points, or 2.18 per cent, to 4,468.17.
In Canada, the TSX added 46.45 suggests end the day at 12,377.77.
On commodity markets, the March crude contract rose 85 cents to stay at US$32.30 a barrel, as the February gold contract fell $4.40 to US$1,115.80 an ounce and March gas dropped one tenth of a cent to US$2.157 per mmBtu.
The loonie lost 0.14 of a U.S. cent to finish trading at 70.91 cents US, following the U.S. Fed said it still plans on raising rates of interest later on despite slowing economic growth.