Major Averages Tumble To Three-Month Closing Lows

(RTTNews) - After ending the previous session roughly flat, stocks saw substantial weakness during trading on Wednesday. With the sharp drop on the day, the major averages added to steep losses posted on Monday, falling to their lowest closing levels in three months.

Energy stocks saw substantial weakness on the day, moving lower along with the price of crude oil. Crude for February delivery plunged $2 to a seven-year closing low of $33.97 a barrel after a report showed a sharp jump in U.S. gasoline inventories.

Reflecting the weakness in the energy sector, the NYSE Arca Natural Gas Index plummeted by 6.3 percent, while the Philadelphia Oil Service Index tumbled by 4.9 percent and the NYSE Arca Oil & Gas Index slumped by 3.9 percent.

Significant weakness also emerged among railroad stocks, as reflected by the 4.1 percent loss posted by the Dow Jones Railroads Index. With the loss, the index fell to its lowest closing level in well over two years.

Most of the other major sectors also showed notable moves to the downside, with steel, semiconductor, brokerage, and chemical stocks seeing considerable weakness.

On the other hand, gold stocks were among the few groups to buck the downtrend, resulting in a 2.4 percent jump by the NYSE Arca Gold Bugs Index. The strength in the sector came as gold for February delivery climbed $13.50 to $1,091.90 an ounce.

The major averages climbed off their worst levels of the day going into the close but remained firmly in the red. The Dow plunged 252.15 points or 1.5 percent to 16,906.51, the Nasdaq slumped 55.67 points or 1.1 percent to 4,835.76 and the S&P 500 dove 26.45 points or 1.3 percent to 1,990.26.