U.S. stocks suffered significant losses Wednesday, with the S&P 500 retreating to the loss column for 2011, on concern about Italy’s next auction of government debt.
“Italy did have a decent short-term auction today, and markets responded neutrally to reasonably well to that, but what is causing market participants greater concern is the longer-term sale tomorrow,” said Mike McGervey, president of McGervey Wealth Management in North Canton, Ohio.
“It doesn’t take a whole lot to push prices around when we see volume this light, whether stocks or currencies,” McGervey added of the thin volumes in the holiday-shortened trading week.
The Dow Jones Industrial AverageDJIA-1.14% fell 139.94 points, or 1.1%, to 12,151.41 with all of its 30 components ending in the red.
The Dow held a 5% gain for the year, with two sessions remaining.
“It has to do with the more defensive nature of some of the Dow stocks,” said McGervey. “Some of the industrials have benefited from modest signs of growth, and a lot of people look at those giants as larger dividend paying stocks.”