Japan's Nikkei index plummeted over 5 percent, weighed down by the strengthening yen and volatile Japanese government bond yields.
(Read More: Sun Will Rise: Investors Still Love Japan)
Investors have been sensitive to the notion that the Fed could soon begin to pull back on its massive unlimited stimulus. Analysts took heart on Wednesday in the comments of Boston Fed President Eric Rosengren, one of the central bank's most vocal proponents of accomodative monetary policy, who said the Fed should continue to flood the economy with more stimulus until the recovery becomes "self-sustaining" and labor markets thaw.
"We do not believe key members of the FOMC have already made up their minds on what the next change in Federal Reserve policy should be," said Nomura analysts in a research note. "Any decision to change the pace of asset purchases will depend on how economic data and financial markets evolve."
Dish Network sweetened its buyout offer for Clearwire Corp to $4.40 per share, valuing the wireless service provider at $6.5 billionand topping a rival bid by Sprint Nextel by nearly 30 percent.
Meanwhile, MidAmerican, a unit of Warren Buffett's Berkshire Hathaway, said it will pay $5.6 billion for NV Energy, the electric utility serving Las Vegas and its casinos.
First Solar surged to lead the S&P 500 gainers after the solar company was raised to "buy" from "neutral" by Goldman Sachs.
In another light day of earnings, Costco edged higher after the warehouse club chain posted earnings that edged past expectations, thanks to low prices for food and gasoline.
Big Lots tumbled after the discount retailer handed in current-quarter and full-year guidance that fell short of expectations.
Joy Global declined after the mining equipment maker reported lower quarterly results and slashed its full-year earnings outlook, hurt by a drop in commodity prices.
Lions Gate Entertainment and Splunk are among notable companies scheduled to post earnings after the closing bell.
Facebook rallied after BMO upgraded the social networking giant to "outperform" from "market perform" and Jefferies lifted its rating on the company to "buy" from "hold."
Moody's Investors Service downgraded aluminum producer Alcoa to junk grade, citing weak aluminum prices and tough market conditions.
Treasury prices rallied after the government auctioned $29 billion in 7-year notes at a high yield of 1.496 percent. The bid-to-cover ratio, an indicator of demand, was 2.70.