Stocks on Wall Street slumped along with commodity prices and the euro after Federal Reserve chairman Ben Bernanke took a cautious view of the US recovery.
Stocks started the day higher, after European banks took more than half a trillion euros from the European Central Bank's lending facility.
Investors also cheered a higher revision of fourth-quarter US economic growth. But Mr Bernanke took the air out of the rally during an appearance before legislators in Washington.
Apart from saying the recovery remained "uneven and modest," he offered few clear signals that the central bank could take additional measures to ease policy.
The Dow Jones Industrial Average was down 53.05 points, or 0.4%, to 12,952.07 at the close (10am NZ time), after rising 50 points earlier in the session.
The S&P 500 index lost 0.7% to 1365.68 and the Nasdaq Composite also shed 0.7% to 2966.89.
The decline came one day after the Dow closed above 13,000 for the first time since May 2008, and the S&P 500 reached its highest level since June 2008.
Earlier today, the Nasdaq briefly topped 3000 before pulling back. It was last at that level on December 13, 2000.
Other markets: Europe down, Asia up
In Europe, stocks finished marginally lower after trading higher for most of the session.
Investors were encouraged by the response to the ECB's offer of a three-year lending facility, with 800 banks taking out loans of €529.5 billion ($842.9 billion).
Later, Mr Bernanke's testimony dragged the European stock indexes down. The Stoxx 600 fell 0.2% to 264.32.
The UK's FTSE 100 index ended down 1% at 5871.51, Germany's DAX fell 0.5% to 6856.08 and France's CAC-40 index ended nearly flat at 3452.45.
Asian markets were mostly higher. Korea's Kospi Index gained 1.3% to 2030.25 and Japan's Nikkei Stock Average was fractionally higher at 9723.24.
Hong Kong’s Hang Seng rose 0.5% to 21,680.08 and Australia’s ASX/S&P 200 rose 0.9% to 4298.50.
But China's Shanghai Composite fell 1% to 2428.49, snapping an eight-session winning streak.
Commodities: Oil, gold down
Crude-oil futures declined after a weekly US government report showed a higher-than-expected increase for crude inventories as well as on diminished prospects for a new round of aid for the US economy.
Crude for April delivery eased 94USc, or 0.9%, to $US105.63 a barrel in New York. Oil has lost nearly 3% over the past two sessions.
Gold slumped to a one-month low as investors bet against a further monetary stimulus from the Fed.
Gold for April delivery, the most actively traded contract, fell $US77.10, or 4.3%, to settle at $US1711.30 an ounce in New York.
The losses erased all of the market's February gains, pushing prices down 1.7% during the month to the lowest level since January 25.
Currencies: US dollar rises
The US dollar turned up against major currencies and extended gains against the euro after Mr Bernanke said the economy was sending out mixed signals.
The euro was under pressure earlier after European banks grabbed more than expected of cheap loans in the ECB's long-term refinancing operation.
The euro was at $US1.3340 compared with $US1.3462 late on Tuesday.
The dollar traded at ¥81.13 compared with ¥80.47, while the euro was at ¥108.23 from ¥108.32.
The UK pound bought $US1.5932 from $US1.5901, while the dollar changed hands at 0.9035 Swiss franc from 0.8953 franc.