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U.S. stocks ended lower on Wednesday, paring sharp gains, after interest rates hit new multi year highs following the release of the latest Federal Reserve minutes.
The Dow Jones industrial average closed 166.97 points lower at 24,797.78 after climbing 303.24 points earlier in the session.
The S&P 500 dropped 0.6 percent to 2,701.33, with real estate falling almost two percent. The Nasdaq composite closed 0.2 percent lower at 7,218.23. The S&P 500 and Nasdaq had risen over one percent each.
The minutes showed that the Fed's rate-setting committee grew more confident in the need to keep increasing rates, with most believing inflation would perk up amid an improving economic landscape. The U.S. central bank has forecast three hikes in 2018.
Stocks previously notched session highs after the minutes were released.
The prospect of higher rates and an sudden decline in January U.S. existing home sales dented the real estate sector, down by 1.81 percent. Other sectors seen as bond proxies due to their high dividend yields, utilities and telecoms, also fell by over one percent.
After inflation worries knocked the S&P 500 down by over ten percent from its Jan. 26 high, stocks had bounced back in recent sessions as yields on the 10-year U.S. Treasury note had stabilized around the 2.9 percent mark. Even with the recent rally, the index has been unable to convincingly hold above its 50-day moving average, seen as a key support level.
Politics remained in the back of investors' minds as developments into Russia's alleged involvement in the 2016 U.S. presidential election persist. The son-in-law of a Russian oligarch Alex Van der Zwaan pleaded guilty to lying to federal officials about alleged links between Russia and Donald Trump's campaign.
