U.S. stocks traded lower on Wednesday, but remained on track to post gains of about 8 percent or more for the year.
“I don’t see any real reason for the decline except last-minute selling and low volume,” said Peter Cardillo, chief market economist at Rockwell Global Capital. He called the extended decline a “technical weakness.”
The Dow Jones Industrial Average fell more than 150 points in the minutes before the close. Cisco led blue-chip declines.
The S&P 500 erased its gains for December with utilities falling more than 1 percent to lead declines across all 10 sectors.
The Nasdaq fell about half a percent, pressured by a nearly 2 percent decline in Apple. The stock is on track to post its first yearly decline in iPad sales since the device was introduced, according to a report from market research firm ABI Research. But the report also said Apple should reverse that trend in 2015, with overall tablet sales rising 16 percent.
Despite Wednesday’s losses, analysts pointed to strong gains for the year, with the Dow up about 8 percent for its sixth straight year of gains and the S&P up nearly 12 percent for 2014.
“Last day of the year, things get exaggerated,” said Peter Boockvar, chief market analyst at The Lindsey Group. He said there were no major news events that caused stocks to reverse from morning gains.
Rising more than 1 percent, Home Depot led gains on the Dow Jones Industrial Average in low volume trade.
Joe Bell, senior equity analyst at Schaeffer’s Investment Research, did not see any direct reason for the gains on the stock, which is the third best performing blue-chip for the year.
“We’re not seeing a ton of price action today with the holiday,” he said. “A lot of people are out of the office.”
The Chicago Purchasing Managers’ Index for December came out at 58.3, below expectations.
“I don’t think it’s a big deal. I think the last day of trading today is on a lot of noise,” Boockvar said.
Pending home sales rose just 0.8 percent in November from a downwardly revised October reading.
Futures pared gains slightly but remained in the green after the weekly initial jobless claims numbers came in a bit higher than expected at 298,000.
“I think the market indices are likely to close in the green and close the year in strong gains,” Cardillo said in the morning. He noted that light trading volume would likely cause “insignificant” but “larger-than-usual gyrations.”
European stocks finished higher in a half-day session, posting an average of 4 percent gains for the year.
In Asia, meanwhile, shares were mixed amid thin volumes, with Japan, South Korea, Indonesia, Thailand and the Philippines shut for public holidays.
After wavering between gains and losses following the release of December’s manufacturing data, China’s Shanghai Composite index regained momentum to climb 2.2 percent on Wednesday and raking in 53 percent year-to-date to be the second best performer globally in 2014. Argentina was the top performer with 59 percent gains.
Markets will be closed on Thursday for New Year’s Day.
Oil prices will continue to be in focus, with the rout deepening on Wednesday. Benchmark Brent crude fell to a 5-1/2-year low below $57 a barrel.
Crude oil futures for February settled down 85 cents, at $53.27 a barrel on the New York Mercantile Exchange, down 46 percent for the year and the lowest level since May 2009. Gold futures settled at $1,184.10, below Tuesday’s settlement of $1,200.40 and down 1.5 percent for the year.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, spiked as much as 21 percent to trade above 19.
The Russell 2000 touched an intraday high before falling to trade in the red.
Decliners were a step ahead of advancers on the New York Stock Exchange, with an exchange volume of 352 million and a composite volume approaching 2 billion as of 3:40 p.m.
Stocks to watch include BP, after the U.K.’s Financial Times reported the supermajor was investigating financial traders in its oil and gas group for foreign exchange manipulation.
Drug store chain operator Walgreen Co. completed its merger with Britain’s Alliance Boots, with the combined company trading under the WBA ticker and the name Walgreens Boots Alliance. Greg Wasson, who had served as Walgreen CEO, is retiring, with Stefano Pessina becoming acting CEO.