U.S. Stocks Close Mixed Amid Choppy Session

NEW YORK (TheStreet) -- U.S. stocks closed mixed Wednesday, after warnings from a Federal Reserve member over the risk of asset-price bubbles offset better-than-expected data from China.

  • The S&P 500 was broadly flat at 1,819.26 while the Dow Jones Industrial Average closed off 0.19% to 15,963.94. The Nasdaq gained 0.24% to 4,201.29.
  • ING U.S. Investment Management's chief market strategist, Doug Cote, told clients that recent gains didn't mean a respite from emerging markets turmoil. "We will see continued volatility as the Fed continues the steady taper and passes the responsibility of pricing risk back to the markets," he said Wednesday.
  • Also fueling positive sentiment was the Senate's vote to raise the government debt ceiling until March 2015.
  • "The fact that we're sailing through this debt ceiling issue uncscathed I think is very exciting," Erik Davidson, deputy CIO for Wells Fargo Private Bank, said in a phone interview.
  • Trading may lighten on Thursday as a massive winter storm, already hammering much of the Southeast United States, moves into the Northeast region late Wednesday night.
  • "The markets [on Wednesday are] taking a bit of a breather; trading is being a bit muted because of the weather," Davidson said.
  • Procter & Gamble (PG) was a top laggard in the Dow, off 1.7% after cutting its profit forecasts because of currency effects. TripAdvisor (TRIP) led gains in the S&P 500, adding 7.2% after it posted a 26% rise in quarterly revenue on Tuesday, helped by a jump in display-based advertising. Fossil Group (FOSL) jumped 3.5% to $121.06 after providing a stronger-than-expected first-quarter earnings outlook and surpassing fourth-quarter earnings estimates by 25 cents at $2.68 a share.
  • Bank of England officials now forecast that the U.K. economy will grow by 3.4% this year, faster than the 2.8% forecast in November. The BOE also said it expects upcoming data to show the unemployment rate in the U.K. fell to 7% in January.
  • China's exports unexpectedly increased 10.6% in January, assuaging some concerns about the health of emerging market economies.
  • St. Louis Federal Reserve Bank President James Bullard warned over the risks of asset-price bubbles now that the U.S. economy was improving. "As the economy improves ... and we continue to have low rates, that's a fertile environment for creation of asset bubbles in the future," Bullard told reporters at the New York Stock Exchange on Wednesday.
  • Zillow (Z), the real estate Web site, is forecast to report fourth-quarter earnings of 7 cents a share. The Street has partnered with Zillow to facilitate their earnings call.

-- Written by Jane Searle, Andrea Tse and Joe Deaux in New York

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