US stocks reversed course in Wednesday's trading session, ending lower for the second day amid rising oil prices and fears that the Federal Reserve will have to move more aggressively to contain inflation.

The see-saw day started out upbeat following a good batch of earnings reports from Procter & Gamble and other companies, but shares tumbled after midday.

The benchmark Dow Jones Industrial Average fell nearly 340 points, or one percent, to finish at 35,028.65.

The broad-based S&P 500 also dropped one percent to end at 4,532.76, while the tech-rich Nasdaq Composite Index fell 1.2 percent to 14,340.25, and is about 10 percent below its November record.

Meanwhile, oil prices continued to march towards $100 a barrel, with WTI at $86.60 in late afternoon trading, 1.4 percent higher.

"I think that a lot of the stocks that have been doing very well over the past couple of weeks like food, energy, financials are running out of steam," Tom Cahill of Ventura Wealth Management told AFP.

And amid the prospect of rising borrowing rates, "you are getting a little bit of bargain hunting in some of the technology stocks."

A trader works on the floor of the New York Stock Exchange at the closing bell January 14, 2022, in New York, New York A trader works on the floor of the New York Stock Exchange at the closing bell January 14, 2022, in New York, New York Photo: AFP / TIMOTHY A. CLARY

Investors were spooked Tuesday as the yield on the 10-year Treasury note jumped above 1.85 percent, amid expectations the Fed could hike interest rates as many as four times this year. The rate, a proxy for the interest rate outlook, remained near that level on Wednesday.

Cahill called the move "a little frightening" even though markets had already factored in rising rates and the increased likelihood the Fed will begin to sell off some of its massive bond holdings.

Amid firms reporting earnings, Procter & Gamble jumped 3.4 percent after it raised its full-year forecast following strong results as robust consumer demand fueled higher sales even though the company increased prices on consumer goods.

Bank of America gained 0.4 percent and Morgan Stanley won 1.8 percent after both companies reported higher quarterly profits. Mixed results from other financial giants have weighed on the stock market in recent days.