U.S. stocks tumbled on Wednesday on investors' worries over Greece's debt load, making it impossible for the market to hold gains after strong demand at a Treasury note auction.
Greece's borrowing costs hit a new high on Wednesday after the government said the country's banks had asked for billions of euros in support and euro-zone states argued over the conditions of potential bailout loans.
We thought progress was being made and the steps were being taken to get this resolved. Now that might be off track, said Alan Lancz, president of Alan B. Lancz & Associates Inc, in Toledo, Ohio.
Stocks had gained some ground after strong demand at a $21 billion Treasury auction of 10-year notes, but were unable to sustain the momentum. The auction was a positive for stocks as U.S. borrowing costs are kept in check and support government efforts to revive the economy.
The auction was fine, but nothing really provided the catalyst to either buy or sell after the open. We've just been vacillating in a pretty small trading range, Lancz said.
The Dow Jones industrial average <.DJI> dropped 101.42 points, or 0.92 percent, to 10,868.57. The Standard & Poor's 500 Index <.SPX> lost 10.05 points, or 0.84 percent, to 1,179.39. The Nasdaq Composite Index <.IXIC> fell 14.18 points, or 0.58 percent, to 2,422.63.
Energy shares were among the biggest losers as crude oil futures fell 1.5 percent, or $1.31, to $85.53 a barrel after data showed domestic inventories rose last week. Exxon Mobil
Goldman Sachs raised its view on a host of regional banks, including KeyCorp
The Nasdaq was supported by strength in technology stocks such as Cisco Systems Inc
Stocks had little reaction to comments from Federal Reserve Chairman Ben Bernanke. The Fed chief reiterated the economy still faces significant headwinds, suggesting the central bank is in no rush to raise interest rates.
(Reporting by Leah Schnurr; Editing by Jan Paschal)