U.S. stocks declined sharply Tuesday, Japan’s central bank spooked investors early Tuesday by leaving its monetary policy unchanged. Investors thought Japan’s central bank would pump more stimulus into the economy.
U.S. investors fear that the same might happen to U.S. market, that the Federal Reserve might follow Japan’s footsteps and slowly stop pumping stimulus into the economy.
U.S. investors to take a wait and see approach until next week, when Fed chairman Ben Bernanke holds his quarterly press conference. Bernanke is expected to give investors some hints as to when the Fed’s easing might stop or slow down.