The logo for the New York Stock Exchange (NYSE) is displayed on Wall Street in New York City, U.S., March 22, 2022.
The logo for the New York Stock Exchange (NYSE) is displayed on Wall Street in New York City, U.S., March 22, 2022. Reuters / BRENDAN MCDERMID

U.S. stocks ended sharply lower on Wednesday as Western leaders began gathering in Brussels to plan more measures to pressure Russia to its halt conflict in Ukraine and oil prices jumped.

Responding to Western sanctions that have hit Russia's economy hard, President Vladimir Putin said Moscow will seek payment in roubles for natural gas sales from "unfriendly" countries, while its forces bombed areas of the Ukrainian capital Kyiv a month into their assault.

Oil prices jumped 5% to over $121 a barrel and U.S. natural gas futures edged up to a seven-week high. [O/R] While higher oil prices benefit energy shares, they are a negative for consumers and many businesses. The S&P 500 energy sector rose along with utilities.

"The resurgence of oil prices is giving people pause," said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. "There needs to be a resolution with Russia. That's going to hold the market back."

The day's decline follows a recent string of gains as the market recovered from lows hit amid the conflict and increased worries about inflation and higher interest rates.

Among the day's biggest drags, Adobe Inc's stock slid after the Photoshop maker late Tuesday forecast downbeat second-quarter revenue and profit and sees an impact on fiscal 2022 revenue due to the Russia-Ukraine crisis.

According to preliminary data, the S&P 500 lost 55.77 points, or 1.21%, to end at 4,455.84 points, while the Nasdaq Composite lost 185.69 points, or 1.32%, to 13,923.13. The Dow Jones Industrial Average fell 453.84 points, or 1.30%, to 34,353.62.

Investors continued to assess the outlook for U.S. interest rates. San Francisco Federal Reserve Bank President Mary Daly said on Wednesday she is open to raising rates by 50 basis points in May, joining other policymakers in saying so.

Last week, the U.S. central bank raised interest rates for the first time since 2018.

Alphabet-owned Google said it will pause all ads containing content that exploits, dismisses or condones the ongoing Russia-Ukraine conflict.

GameStop Corp shares jumped after Chairman Ryan Cohen's investment company bought 100,000 shares of the videogame retailer.