The Federal Reserve's statement on monetary policy pointed to concens about economic weakness. First-quarter GDP growth was lower-than-expected, weighing on the financial markets.
Stocks took a step back on Wednesday after a Federal Reserve statement pointed to economic weakness in a number of areas, including the job market. The cautious tone suggesting the central bank was in no rush to raise interest rates. Earlier in the day, new data showed GDP rising only two-tenths of a percent during the first quarter, a confirmation of the weakness the Fed sees. The Fed also removed calendar references, instead focusing on data in their decision making. Reuters correspondent Jonathan Spicer: SOUNDBITE: JONATHAN SPICER, CORRESPONDENT, REUTERS IN (ENGLISH) SAYING: "They didn't want to give guidance, I think, on rate hikes. They wanted to get completely away from schedules, times, dates, anything like that, and just completely put it into the port of data. It's all data, now it's all economic data, and, in particular, will we bounce back from the first quarter." A brighter outlook for housing, pending home sales increased in March to its highest level since June 2013 according to the National Association of Realtors. Stocks in focus include Lumber Liquidators. Shares of the hardwood flooring retailer plunged more than 18 percent after it announced the U.S. Department of Justice is seeking criminal charges related to certain imported wood flooring products from China. Shares of Salesforce.com surged higher, hitting a new record. The cloud software company is talking to potential acquirers, according to Bloomberg. Starwood Hotels posted a decline in revenue and profit for the first quarter. However, shares rose on news it has hired an investment bank to explore strategic alternatives. Starwood owns the St. Regis and Westin hotel brands. GrubHub reported earnings that beat estimates, but shares skidded on guidance for the current quarter which is in line with analyst estimates. European markets suffered one of its worst days so far this year. Blame it on weak corporate earnings, a rebounding Euro along with disappointing economic data in the U.S.