* VIX jumps almost 9 pct as anxiety rises over central
* S&P closes just above its 50-day moving average
* Dow and S&P 500 down 0.8 pct; Nasdaq off 1.1 pct
By Rodrigo Campos
NEW YORK, June 12 U.S. stocks fell on Wednesday,
with the Dow sliding more than 100 points on another volatile
day as traders extended a selloff driven by concern about
central banks winding down their stimulus measures.
The S&P 500 was caught between support near its 50-day
moving average at 1,610.55 and resistance at its 14-day moving
average at 1,637.27. The S&P 500 has closed below its 50-day
moving average only once this year - in mid-April.
Traders have kept their focus on the possibility that the
Federal Reserve will reduce its monthly bond purchases in coming
months, removing one of the pillars of the U.S. stock market's
rally this year.
These worries have sparked volatility and triggered a
pullback in U.S. stock indexes from historic highs.
The Dow on Wednesday swung more than 200 points for the
seventh time in the past 15 trading days, going back to Fed
Chairman Ben Bernanke's latest congressional testimony on May
22. At the time, he hinted that the Fed may begin to reduce its
quantitative easing - consisting of $85 billion a month in bond
purchases - in the coming months.
"There are concerns about the path for the Fed and the
markets that benefited from QE and how those trades will
unwind," said Paul Zemsky, head of asset allocation at ING
Investment Management in New York.
"The level of uncertainty has gone up tremendously in the
The CBOE Volatility Index, known as the VIX, shot up
8.9 percent to 18.59. The VIX has jumped more than 20 percent so
far this week.
Zemsky said the perception of increased risk may be forcing
large market players like hedge funds to sell, putting more
downward pressure on stocks.
The Dow Jones industrial average dropped 126.79
points or 0.84 percent, to close at 14,995.23. The S&P 500
fell 13.61 points or 0.84 percent, to 1,612.52. The
Nasdaq Composite lost 36.52 points or 1.06 percent, to
end at 3,400.43.
The S&P 500 has fallen 3.4 percent from its record closing
high of 1,669.16 set on May 21.
On Wednesday, the benchmark index closed 2 points above its
50-day moving average of 1,610.55. If the S&P 500 falls below
that level, the selloff could intensify.
American Express Co, down 2.4 percent at $74.72, was
the Dow's biggest percentage decliner.
In contrast, Hewlett-Packard was the biggest
percentage gainer among the blue chips after its chief executive
said revenue growth was "still possible" in fiscal 2014. The
computer maker's stock jumped 2.8 percent to $24.91.
Going against the sharp downturn was Cooper Tire & Rubber
. The stock surged 41.1 percent to $34.66 after India's
Apollo Tyres agreed to buy the second-biggest U.S.
tire maker for about $2.5 billion.
Shares of Booz Allen Hamilton fell 3.5 percent to
$16.54 after Susquehanna Financial Group's analysts said U.S.
intelligence agencies probably will freeze some of the company's
projects temporarily, pending a review of how it handles
Booz Allen said on Sunday that one of its employees was
responsible for leaking details of a top secret U.S.
Shares of supermarket operator Safeway Inc jumped
31.5 percent to $30.40 in after-hours trading after Empire
Company Ltd, parent of Canada's No. 2 grocer Sobey's,
said it is acquiring Safeway's Canadian arm for $5.7 billion in
About 6.2 billion shares exchanged hands on the New York
Stock Exchange, the Nasdaq and NYSE MKT, slightly below the
daily average so far this year of nearly 6.38 billion.
Decliners outpaced advancers by a ratio of more than 4 to 1
on the NYSE. On the Nasdaq, more than two stocks fell for every
one that rose.