Stocks moved sharply lower at the start of trading on Wednesday, adding to the losses posted in the previous session. The major averages all showed notable moves to the downside, pulling back further off their recent highs.
The initial weakness on Wall Street came as traders continued to express disappointment with the minutes of the latest Federal Reserve meeting, which were interpreted as a sign that the central bank is not likely to engage in any further quantitative easing.
A disappointing Spanish bond auction also generated some negative sentiment, overshadowing a report from payroll processor Automatic Data Processing (ADP) showing continued job growth in the U.S. private sector.
Shortly, the Institute for Supply Management is scheduled to release its monthly report on activity in the U.S. service sector. Economists expect the index of activity in the sector to edge down to 57.0 in March from 57.3 in February.
After seeing substantial weakness in the previous session, gold stocks are seeing further downside in early trading amid a sharp drop by the price of the precious metal. With the price of gold plummeting by nearly $50 an ounce, the NYSE Arca Gold Bugs Index is down by 2.3 percent.
Electronic storage stocks have also come under pressure, with SanDisk (SNDK) leading the way lower after the memory chip maker lowered its first quarter revenue guidance.
Semiconductor, housing, and networking stocks are also seeing considerable weakness, moving lower along with the most of the major sectors.
The major averages have edged up off their lows for the young session in the past few minutes but remain firmly negative. The Dow is down 103.91 points or 0.8 percent at 13,095.64, the Nasdaq is down 27.49 points or 0.9 percent at 3,086.08 and the S&P 500 is down 10.30 points or 0.7 percent at 1,403.08.
by RTT Staff Writer
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