Federal Reserve Chairman Ben Bernanke's dour assessment of the US recovery hit US stocks on Wednesday, as his comment that the economy faced "unusually uncertain" prospects rattled investors. Stocks tumbled after Bernanke acknowledged the labour market's continued weakness while offering few specific options to stimulate lending and investment.
The Dow Jones industrial average lost 109.51 points, or 1.07 percent, to 10,120.45. The Standard & Poor's 500 fell 13.91 points, or 1.28 percent, to 1,069.57. The Nasdaq Composite dropped 35.16 points, or 1.58 percent, to 2,187.33.
Bernanke's economy comment batters market: Bernanke spoke to the Senate Banking Committee in the first of two days of his semi-annual testimony to Congress. Apple Inc rose 0.9 percent to $254.24 after it posted robust quarterly results, but the company's conservative margin forecast limited gains..
Another financial stock showing strength was Wells Fargo & Co, which rose 0.6 percent to $26.06 after rising loan demand helped lift its earnings more than analysts had expected.. After the closing bell, cellphone chip supplier Qualcomm Inc rose 4 percent to $37.59 on news its quarterly earnings and revenue beat Wall Street's estimates on strong smartphone demand.
Online marketplace eBay Inc added 4.1 percent to $20.99 in extended-hours trading as it beat Wall Street's quarterly profit estimates, helped by a record performance at its PayPal service. The benchmark S&P 500 found support during the regular session at its 14-day moving average and held above 1,060, a critical level according to some technical analysts.
Weighing on the Nasdaq were shares of Internet company Yahoo, down 8.5 percent to $13.91 a day after it posted revenue that missed Wall Street's estimates. About 8.68 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, below last year's estimated daily average of 9.65 billion. Declining stocks outnumbered advancing ones on the NYSE by a ratio of about 2 to 1, while for every stock that rose on the Nasdaq, about three fell.
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