Stocks have moved sharply lower over the course of the trading day on Wednesday, offsetting the strong gains posted in the previous session. Renewed concerns about the financial situation in Europe have contributed to the pullback by the markets.
The major averages are currently posting steep losses, near their worst levels of the day. The Dow is down 162.23 points or 1.3 percent at 12,418.46, the Nasdaq is down 41.12 points or 1.4 percent at 2,829.87 and the S&P 500 is down 19.45 points or 1.5 percent at 1,312.97.
Much of the weakness on Wall Street stems from the renewed worries about Europe, with rising Italian and Spanish bond yields contributing to the negative sentiment.
A new poll out of Greece showing the anti-bailout Syriza party in the lead in next month's elections has also led to renewed concerns about the outlook for the debt-plagued nation.
Disappointing U.S. economic data has also generated some selling pressure, as a report from the National Association of Realtors showed that pending home sales unexpectedly saw a notable decrease in the month of April.
NAR said its pending home sales index tumbled 5.5 percent to 95.5 in April after rising 3.8 percent to a downwardly revised 101.1 in March. The drop by the index surprised economists, who had expected pending home sales to edge up by 0.5 percent.
A pending home sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
Among individual stocks, Pep Boys (PBY) is posting a particularly steep loss after the auto parts retailer announced the termination of its proposed merger with Gores Group. Shares of Pep Boys have tumbled by 21.4 percent.
Blackberry maker Research in Motion is also under pressure after saying it now expects to report an operating loss for its first quarter. The company attributed the forecast of a loss to the competitive environment.
Meanwhile, shares of Sallie Mae (SLM) are bucking the downtrend after the student lender said its board authorized the repurchase of an additional $400 million worth of stock.
Most of the major sectors have shown notable moves to the downside on the day, reflecting the broad based weakness in the markets.
Housing stocks have shown a substantial downward move following the disappointing pending home sales data. The Philadelphia Housing Sector Index is down by 3.8 percent after closing higher in five out of the six previous sessions.
Significant weakness also remains visible among oil service stocks, which are moving sharply lower along with the price of crude oil. With crude for July delivery tumbling $2.86 to $87.90 a barrel, the Philadelphia Oil Service Index is down by 3.9 percent.
Networking, steel, natural gas, and chemical stocks are also posting steep losses after turning in some of the market's best performances on Tuesday.
On the other hand, gold stocks have turned higher over the course of the session, driving the NYSE Arca Gold Bugs Index up by 1 percent. A turnaround by the price of gold has contributed to the rebound by the sector.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan's Nikkei 225 Index ended the day down by 0.3 percent, while Hong Kong's Hang Seng Index plummeted by 1.9 percent.
The major European markets also showed notable moves to the downside on the day. While the French CAC 40 Index tumbled 2.2 percent, the U.K.'s FTSE 100 Index and the German DAX Index slumped 1.7 percent and 1.8 percent, respectively.
In the bond market, treasuries have moved sharply higher amid the renewed worries about Europe. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, has plunged 10.4 basis points to a record low of 1.627 percent.
by RTT Staff Writer
For comments and feedback: firstname.lastname@example.org