US markets continued their decline on Wednesday and major indices closed lower by over a quarter percent. Though there was some midsession upmove on getting sharper-than-expected increases in housing and industrial production data but the worries about the political disarray in Greece and its future within the eurozone continued to weigh on sentiment. The minutes of the Federal Reserve's most recent monthly policy meeting also flagged fiscal concerns. However, the policymakers kept alive the possibility of a fresh round of monetary stimulus on downside risks to a moderately expanding economy.
The US Commerce Department reported Wednesday that housing starts rose to a seasonally-adjusted annual rate of 717,000 in April from an upwardly revised 699,000 units in March. The Federal Reserve reported that industrial production increased by 1.1% in April, from a downwardly-revised fall of 0.6% in March. The report also said that capacity utilization jumped to 79.2% for April from a downwardly revised 78.4% in March.
In Europe, after being unable to form a coalition government amid vastly conflicting views on the country's austerity measures, Greece now faces new elections in June. Also there was news that European Central Bank was stopping monetary operations with some Greek banks because they are undercapitalized.
The Dow Jones industrial average lost 33.45 points or 0.3 percent to 12,598.55, finishing at the lowest level since mid-January. The S&P 500 dropped 5.86 points, or 0.44 percent 1,324.80, and the Nasdaq lost 19.72 points, or 0.68 percent to 2,874.04. Both indexes closed at the lowest level since early February.
Most of the Indian ADRs closed in red on Wednesday, HDFC Bank was down by 0.90%, ICICI Bank down by 0.68%, Infosys down by 0.68%, Wipro down by 0.29% and MTNL was down by 0.02%.