This story was updated at 4:45 p.m. EDT.

U.S. stocks fell sharply Wednesday as weak earnings reports from Walt Disney, Macy's and Fossil reverberated across the consumer sector.

The Dow Jones Industrial Average closed the day down 217 points, or 1.2 percent, at 17,711, erasing most of Tuesday’s 222-point rally. The broader S&P 500 stock index was down 20 points, or 1 percent, at 2,064, while the Nasdaq composite slid 49 points, or 1 percent, to 4,761.

Disney shares were down 4 percent at $102 after the company posted a rare earnings miss. The stock was the biggest drag on the Dow.

Department store chain Macy's tumbled 15 percent to $31, while watchmaker Fossil sank as much as 34 percent to a 6 1/2-year low of $26.51 after the two companies slashed their full-year forecasts.

The drop in stocks Wednesday comes a day after the S&P 500 notched its biggest daily percentage gain in two months.

Eight of the 10 major S&P sectors were lower, led by the consumer discretionary index's drop. The broader S&P retail index also fell.

"We're getting a lot of news on U.S. consumers today, and it isn't good news," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

"Wages aren't rising, and it's quarters like these that show that the consumer isn't too optimistic about the U.S. economy."

Macy's weak earnings report also weighed on big retailers. Dow components Wal-Mart and Nike dropped, while Target fell 5 percent to $76.

Traders are struggling to find new catalysts to propel the market back toward record highs due to underwhelming first-quarter earnings and mixed economic data that provided little clarity on the path of the Federal Reserve's rate hike path.

First-quarter earnings for S&P 500 companies have mostly beaten analysts' expectations but are still estimated to have fallen 5.4 percent from a year ago, according to Thomson Reuters data.

Macy's report dragged down other department store chains, with J.C. Penney, Kohl's, Nordstrom and Dillard's falling sharply.

Fossil's report, coupled with Macy's results, weighed on other luxury retailers such as Movado, which tumbled 10 percent, and Michael Kors, which dropped 12 percent.

Office Depot slumped 40 percent to $4 after terminating its planned merger with Staples. Staples was down 18 percent at $8.

Data from Reuters were used to report this story.