By Saumya Vaishampayan
U.S. stocks fell Wednesday for the second session in a row,
sending the S&P 500 index to its lowest level in nearly two
weeks.
Stocks pared losses in early afternoon trade. The S&P 500
declined eight points, or 0.4%, to 2099, its lowest level since
Feb. 19. The index had fallen as much as 20 points earlier.
The Dow Jones Industrial Average fell 81 points, or 0.5%, to
18123. The Nasdaq Composite slipped 10 points, or 0.2%, to
4970.
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%, 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 profit and low interest rates.
For much of the recovery, investors flocked to safer parts of the
stock market, such as utilities stocks, which pay out large
dividends, said Eddie Perkin, who oversees about $35 billion as
chief equity investment officer at Eaton Vance Management. That
tide is starting to shift, with utilities stocks posting the
biggest sector declines this year.
Mr. Perkin said he favors stocks in the technology and
health-care sectors, which he characterizes as defensive growth
stocks. Those stocks have benefited from a wave of merger activity,
which he said could continue.
Investors are looking ahead to Friday's jobs report. Economists
surveyed by The Wall Street Journal expect the Labor Department to
report Friday the U.S. economy added 240,000 jobs in February.
Strong economic data tend to heighten speculation about when the
Federal Reserve could raise short-term rates.
U.S. private payrolls increased by 212,000 in February,
according to Wednesday's national employment report compiled by
payroll processor Automatic Data Processing Inc. and forecasting
firm Moody's Analytics. 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 $1.1073.
In other markets, gold futures fell 0.3% to $1200.90 an ounce.
Crude-oil futures slipped 0.2% to $50.40 a barrel.
Treasury prices were little changed, with the 10-year yield
trading at 2.125% versus 2.122% on Tuesday. Yields rise as prices
fall.
Among individual stocks, Abercrombie & Fitch Co. posted a
worse-than-expected 14% drop in sales in its latest quarter. Shares
slid 13%.
Exxon Mobil Corp. announced plans to cut capital spending by 12%
this year to $34 billion. Shares fell 0.1%.
Write to Saumya Vaishampayan at saumya.vaishampayan@wsj.com
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