U.S. stocks finished mixed on Wednesday following the prior day's jump, with volatility still in play after minutes from the Federal Reserve had central bankers viewing the benefits of monetary stimulus as diminishing over time, and a report on payrolls was better than anticipated.
"The comments were maybe a little more bullish than we thought; there was more confidence in economic growth going forward. If the Fed expects all those things to come to fruition, that would argue certainly for continuing the tapering and possibly faster tapering'," said Darrell Cronk, regional chief investment officer at Wells Fargo Private Bank.
"So it makes the equities markets take a little bit of a pause, if the bias is to continue at an accelerated pace," Cronk added.
The U.S. dollar gained strength for a second day against the euro and the price of Treasuries and gold declined after ADP Research Institute reported U.S. companies added 238,000 workers to payrolls in December, better than the 200,000 anticipated, increased the argument for the Fed to continue its tapering.
"The U.S. labor market continues to signal acceleration heading into the New Year adding justification -- where it needed -- to Bernanke and company's decision to wind down the level of bond purchases," offered Andrew Wilkinson, chief market analyst at Interactive Brokers, referring to Federal Reserve Chairman Ben Bernanke and his central-bank colleagues, who are cutting monthly bond purchases by $10 billion to $75 billion this month.
"Most of the data, consumer and manufacturing, all suggest the employment picture is improving, ADP is just another data point that legitimizes the trend. That points to a little upward bias to Friday's report," said Cronk of Friday's nonfarm payrolls report for December.