Wall Street ends flat as Draghi disappoints
U.S. stock indexes ended a volatile session little changed on Thursday after the European Central Bank reduced interest rates but ECB chief Mario Draghi confounded investors who expected multiple rate cuts by saying more were unlikely.
Stocks jumped early in the day after the ECB pushed its deposit rate deeper into negative territory and increased its asset-buying program to 80 billion euros a month from 60 billion in an effort to boost growth in the region.
"The world was really, really happy with this mainly because we're all addicted to zero interest rates," said Kim Forrest, research analyst at Fort Pitt Capital Group in Pittsburgh. "It's free money."
When Draghi said future cuts would happen only under extreme circumstances, investors expecting even lower rates switched their strategy to risk off, Forrest said.
At the same time, she said, fears that lower interest rates in Europe would harm U.S. banks and negatively impact exports by leading to euro devaluation weighed on the market further.
The Dow Jones industrial average .DJI fell 5.23 points, or 0.03 percent, to 16,995.13, the S&P 500 . SPX gained 0.31 points, or 0.02 percent, to 1,989.57 and the Nasdaq Composite .IXIC dropped 12.22 points, or 0.26 percent, to 4,662.16. U.S. jobless claims fell more than expected last week to their lowest levels since October, pointing to sustained strength in the labor market that should further dispel fears of a recession.