* All eyes to stay on central bank policy
* S&P utilities and financial sectors lead the decline
* Dow off 0.5 pct; S&P 500 down 0.5 pct; Nasdaq off 0.7 pct
By Angela Moon
NEW YORK, June 12 U.S. stocks fell on Wednesday
in another volatile session as investors extended a recent
selloff that has been driven by the unwinding of bullish bets
built on supportive policy from the world's largest central
The day started off relatively strong after recent declines,
but U.S. stock indexes turned negative in late morning trade
following more weakness in the U.S. dollar against the yen,
which has driven much of the activity of late.
Investors are concerned that the Federal Reserve will reduce
its monthly bond buying in coming months, removing a leg of
support that has kept interest rates low and helped drive the
U.S. stock market's rally this year.
Worries that the Fed may reduce its stimulus efforts have
kept investors nervous for weeks, triggering wider intraday
swings. The Dow has moved around 200 points so far for the day.
In seven of the 15 trading days since Fed Chairman Ben
Bernanke's testimony to a congressional panel, the Dow has moved
more than 200 points. In 15 of the last 16 sessions, the Dow has
moved more than 100 points.
The S&P utilities sector index and the S&P
financial index were the day's biggest decliners, with
each index off 0.6 percent. Energy stocks fared better, with the
S&P energy sector index off 0.4 percent.
"There just isn't much news to offset the potential negative
of what will eventually happen, which is the Fed tapering off.
You don't have fundamental evidence that the Fed will or will
not be tapering off soon, and the market is caught in the middle
period," said Rick Meckler, president of LibertyView Capital
Management in Jersey City, New Jersey.
The Dow Jones industrial average was down 67.90
points, or 0.45 percent, at 15,054.12. The Standard & Poor's 500
Index was down 8.17 points, or 0.50 percent, at
1,617.96. The Nasdaq Composite Index was down 24.44
points, or 0.71 percent, at 3,412.51.
Volatility has increased steadily in recent days. The CBOE
Volatility Index, known as the VIX, shot up 6 percent to
18.09 at midday. If the VIX ended the day there, that would be
the highest closing level since late February for Wall Street's
favored index of anxiety.
American Express Co, down 1.6 percent at $75.28, was
the Dow's biggest percentage decliner. The company's card
business makes it particularly sensitive to interest rates.
In contrast, Hewlett-Packard was the Dow's biggest
percentage gainer after its chief executive said revenue growth
was "still possible" in fiscal 2014. The computer maker's stock
shot up 2.7 percent to $24.89.
On Tuesday, the benchmark S&P 500 dropped 1 percent
in volatile trading after Japan's central bank disappointed
markets by holding its monetary policy steady.
The lack of further action by the Bank of Japan kindled
uneasiness over when global central banks, particularly the Fed,
will wind down their ultra-loose monetary policies.