US stocks fell on Wednesday after Federal Reserve Chairman Ben Bernanke sounded a cautious note about inflation and the economic outlook, adding to concerns raised by weak durable goods data. Escalating tensions between Iran and the West also kept investors on edge and sent crude oil prices higher.
The weaker-than-expected economic data was accompanied by declines in shares of manufacturers, including Boeing Co, 3M Co and General Electric Co. The Dow Jones industrial average was down 53.11 points, or 0.43 percent, at 12,344.18. The Standard & Poor's 500 Index was down 5.03 points, or 0.35 percent, at 1,423.58. The Nasdaq Composite Index was down 6.09 points, or 0.25 percent, at 2,431.34.
In testimony on Capitol Hill, Bernanke said core inflation remained "uncomfortably high," referring to inflation minus volatile food and energy costs.
Bernanke said the central bank has not shifted its focus away from battling inflation, while at the same time he said subprime mortgage problems could delay a housing recovery.
Boeing shares fell 0.9 percent to $89.70, while shares of GE dropped 0.9 percent to $35.47 and those of 3M slipped 0.9 percent to $76.50. Shares of home builders extended losses after Beazer Homes USA Inc, the sixth-largest US home builder, said it is co-operating with federal prosecutors in a probe relating to its mortgage lending. Beazer shares slid 9.4 percent to $28.45.
Shares of Wal-Mart Stores Inc fell 1.5 percent to $46.76 after its chief executive said in a television interview late Tuesday that 2007 is going to be a "challenging" year.
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