Wall Street was mixed overnight as the promise of ongoing monetary support to help the US economy kick into higher gear was muted by concern about the outlook for corporate earnings from companies including Groupon and Whole Foods.
With about an hour of trading left in the day in New York, the Dow Jones Industrial Average climbed 0.58 per cent, while the Standard & Poor&
39;s 500 Index rose 0.37 per cent. The Nasdaq Composite Index slid 0.72 per cent, as technology stocks fell further out of favour.
Gains in shares of American Express and Verizon Communications, both up 1.8 per cent, helped propel the Dow higher.
US Federal Reserve Chairman Janet Yellen told Congress both the US economy and the American jobs market have continued to improve, but stressed that the Federal Open Market Committee plans to maintain the stream of easy money.
"In light of the considerable degree of slack that remains in labour markets and the continuation of inflation below the committee's 2 per cent objective, a high degree of monetary accommodation remains warranted," Yellen told the Joint Economic Committee.
Last week the Fed lowered its monthly bond-buying program by US$10 billion to US$45 billion.
"With the harsh winter behind us, many recent indicators suggest that a rebound in spending and production is already under way, putting the overall economy on track for solid growth in the current quarter," Yellen said.
"One cautionary note, though, is that readings on housing activity - a sector that has been recovering since 2011 - have remained disappointing so far this year and will bear watching."
Indeed, a Labor Department report on Wednesday showed a gauge of US employee productivity reported the weakest reading in a year in the first quarter, declining at a 1.7 per cent annualised rate. Weather was seen as a key reason for the result.
Meanwhile, technology stocks continued their downward slide, as investors reassess some of the loftiest valuations. Shares of Groupon sank, last down more than 20 per cent, as the company' sales outlook fell short of expectations.
Shares of Yahoo! fell, last down 6.1 per cent. The company is selling about 40 per cent of its stake in Alibaba as the Chinese tech company on Tuesday filed for an initial public offering.
"You're seeing a brutal shift from growth and momentum investing to more value-based investing," Chad Morganlander, a fund manager at Stifel Nicolaus & Co, told Bloomberg News.
In other news, Whole Foods shares shed nearly 19 per cent after the company missed quarterly profit estimates and then downgraded its forecast for annual earnings amid increased competition.
In Europe, the Stoxx 600 Index ended the day at 336.03, close to where it had started. The UK's FTSE 100 edged a couple of points lower to close at 6,796.44. However, France's CAC 40 gained 0.4 per cent, while Germany's DAX added 0.6 per cent.