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US markets end lower on rate hike worries after Yellen’s comments

05 Nov 2015 Evaluate

The US markets got a halt to the two days gaining streak on Wednesday, with main indices retracting off yesterday's three-month closing highs, as Federal Reserve Chairwoman Janet Yellen hinted that a 25 basis point rate hike in December would not derail the economy or the housing market. Yellen though stressed that no decision has been made but said raising rates 'in a timely fashion' is the 'prudent thing to do.' New York Fed President William Dudley also struck a hawkish tone, saying he agreed with Fed Chairwoman that a December rate hike is a live possibility.

The remarks of the Fed chief came on the heels of some upbeat U.S. economic data. Payroll processor ADP released a report showing that private sector employment increased roughly in line with economist estimates in October. ADP said the private sector added 182,000 jobs in October following a downwardly revised increase of 190,000 jobs in September. A separate report from the Institute for Supply Management said activity in the service sector unexpectedly grew at a faster rate in October. The ISM said its non-manufacturing index climbed to 59.1 in October from 56.9 in September.

The Dow Jones Industrial Average lost 50.57 points or 0.28 percent, to 17,867.58. The Nasdaq Composite ended down by 2.65 points or less than 0.05 percent, at 5,142.48 and the S&P 500 fell 7.46 points or 0.35 percent to 2,102.33.

The Indian ADRs ended mostly in red on Wednesday, HDFC Bank was down by 0.92%, ICICI Bank was down by 0.09%, Infosys down by 0.20% and Wipro was down by 0.10%, while the Tata Motors gained 0.48%.

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