WASHINGTON (dpa-AFX) - Stocks have moved mostly lower during trading on Wednesday, giving back ground following the upward move seen over the two previous sessions. The major averages have all moved to the downside but remain well off last Friday's three-month closing lows.
Currently, the major averages are just off their lows of the session. 442.60 points or 0.9 percent at 46,550.66, the Nasdaq is down 141.37 points or 0.6 percent at 22,338.15 and the S&P 500 is down 43.04 points or 0.6 percent at 6,673.05.
The weakness on Wall Street comes following the release of a Labor Department report showing producer prices in the U.S. increased by much more than expected in the month of February.
The Labor Department said its producer price index for final demand advanced by 0.7 percent in February after climbing by 0.5 percent in January. Economists had expected producer prices to rise by 0.3 percent.
The report also said the annual rate of growth by producer prices accelerated to 3.4 percent in February from 2.9 percent in January. Yearly growth was expected to remain unchanged.
Along with the recent spike in crude oil prices due to the Middle East war, the data has added to recent concerns about the outlook for inflation ahead of the Federal Reserve's monetary policy announcement later this afternoon.
'This isn't the kind of PPI report the Fed wants to see,' said Nationwide Financial Markets Economist Oren Klachkin. 'This report suggests inflation was going to accelerate even before the Iranian conflict hit.'
While the Fed is widely expected to leave interest rates unchanged, traders are likely to pay close attention to central bank officials' latest projections.
Sector News
Gold stocks have shown a substantial move to the downside amid a steep drop by the price of the precious metal, with the NYSE Arca Gold Bugs Index plunging by 5.2 percent to a two-month intraday low.
Significant weakness is also visible among telecom stocks, as reflected by the 1.7 percent loss being posted by the NYSE Arca North American Telecom Index.
Biotechnology, airline and pharmaceutical stocks are also seeing notable weakness, moving lower along with most of the other major sectors.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index surged by 2.9 percent, while Hong Kong's Hang Seng Index advanced by 0.6 percent.
Meanwhile, the major European markets have moved to the downside on the day. While the U.K.'s FTSE 100 Index is down by 1.0 percent, the German DAX Index down by 0.9 percent and the French CAC 40 Index down by 0.2 percent.
In the bond market, treasuries are giving back ground after moving higher over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 2.8 basis points at 4.230 percent.
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