By Saumya Vaishampayan
U.S. stocks fell Wednesday for the second session in a row,
sending the Dow industrials and S&P 500 to their lowest levels
since mid-February.
The Dow Jones Industrial Average fell 135 points, or 0.7%, to
18068, on track to close at its lowest level since Feb. 19.
The S&P 500 declined 12 points, or 0.6%, to 2095, its lowest
level since Feb. 12. The Nasdaq Composite slipped 17 points, or
0.3%, to 4963.
Traders said there was no sense of panic among investors selling
stocks Wednesday. Declines were broad-based, with nearly all
S&P 500 sectors in negative territory. Telecommunications
stocks in the S&P 500 fell the most, down 1.3%, while
health-care stocks were the sole gainers, up 0.3%.
"Health care...has really been a sector for all seasons," said
Eric Wiegand, senior portfolio manager at U.S. Bank Wealth
Management, which has $126 billion under management. "The
underlying demand trends we find very attractive and favorable," he
said, referring to the aging population in many developed countries
that will lift demand for health-care services.
The Dow and S&P have retreated from all-time highs hit
Monday. "The markets have a tendency to...pull back modestly when
record high levels are hit," said Randy Frederick, managing
director of trading and derivatives at Charles Schwab.
The six-year bull market in U.S. stocks has been driven by an
improving economy, rising corporate profits and low interest rates.
Federal Reserve officials are now debating when to raise short-term
rates, which have been held near zero since December 2008. The Fed
considers employment and inflation in making monetary policy
decisions. Chicago Fed Bank President Charles Evans said Wednesday
the central bank should refrain from raising rates until early 2016
as inflation remains low.
Highly anticipated employment numbers are set to be released
Friday. The Labor Department is expected to report the U.S. economy
added 240,000 jobs in February, according to economists surveyed by
The Wall Street Journal. Strong economic data tend to heighten
speculation about when the Federal Reserve could raise short-term
rates.
"We want a number that's good but not too good" for stocks to
continue grinding higher, said Larry Peruzzi, director of
international trading at Cabrera Capital Markets, referring to
Friday's report.
Data released Wednesday showed U.S. private payrolls increased
by 212,000 in February. Economists surveyed by The Wall Street
Journal had expected payrolls to increase by 215,000.
In European stock markets, France's CAC 40 and Germany's DAX
both advanced 1%. Investors are looking ahead to a Thursday meeting
of the European Central Bank, which could provide details on how it
will execute its bond-buying program. The euro hit an 11-year low
against the U.S. dollar, recently trading at $1.1074.
In other markets, gold futures fell 0.3% to $1200.40 an ounce.
Treasury prices were little changed, with the 10-year yield trading
at 2.119% versus 2.122% on Tuesday. Yields fall as prices rise.
Crude-oil futures rose 1.9% to $51.51 a barrel. Oil prices have
stabilized in recent weeks, though they have tumbled more than 50%
since June. The slide in oil prices since last summer has weighed
on shares of energy companies, which have been forced to slash
spending plans and dividends.
"Energy has been bludgeoned enough that it's time to take a good
hard look in the area," said Doug Foreman, chief investment officer
of Kayne Anderson Rudnick Investment Management, which oversees
$9.3 billion.
Exxon Mobil Corp. announced plans to cut capital spending by 12%
this year to $34 billion. Shares fell 0.6%.
In other corporate news, Abercrombie & Fitch Co. posted a
worse-than-expected 14% drop in sales in its latest quarter. Shares
slid 14%.
Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com
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