By Caroline Valetkevitch
NEW YORK -- U.S. stocks lost more than 1 percent Wednesday in the S&P 500's biggest decline since Oct. 13 as another big drop in oil prices hammered energy shares.
The S&P 500 has lost 2.4 percent this week so far, reversing a recent trend. The Dow and S&P 500 had capped a seventh straight week of gains Friday.
Selling accelerated in afternoon trading, and by day's end, NYSE declining issues outnumbered advancers by a ratio of 4.66 to 1 ratio. In a sign of rising investor caution, the CBOE Volatility index rose 24.5 percent, its biggest daily percentage gain since July 31.
The S&P energy index fell 3.1 percent and led declines on the S&P 500, but selling was broad and all 10 S&P sector lost at least 1 percent on the day.
Brent crude touched a new five-year low of $63.56 as Saudi Arabia's oil minister reiterated that he has no plans to cut output, while OPEC forecast global demand for OPEC crude in 2015 to fall to the lowest level in more than a decade.
%VIRTUAL-pullquote-It's a sea of red, a uniform purge that is related to concerns about global demand.%Falling oil prices have added to worries about global demand and raised concerns about earnings for energy companies, with year-end tax selling putting additional pressure on the group. The S&P energy sector is now down 14.7 percent for 2014, the worst performing of the 10 major S&P sectors.
"It's a sea of red, a uniform purge that is related to concerns about global demand," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
"We've had this oil issue lingering over the market, and OPEC trimming their forecast is weighing on equity investors, who had precipitated the concerns about global demand way back in September."
The Dow Jones industrial average (^DJI) fell 268.05 points, or 1.51 percent, to 17,533.15, the Standard & Poor's 500 index (^GPSC) lost 33.68 points, or 1.64 percent, to 2,026.14 and the Nasdaq composite (^IXIC) dropped 82.44 points, or 1.73 percent, to 4,684.03.
The number of NYSE stocks making new 52-week lows totaled 271, while 115 made new highs.
Shares of Yum Brands (YUM) dropped 6.2 percent at $70.53 a day after it again lowered its profit forecast for the year, hurt by slower-than-expected sales recovery in China following a food safety scare.
Among the day's gainers were airline shares, including Southwest Airlines (LUV), up 1.8 percent at $41.48. Barclays said airlines stand to see a decline of about $10 billion in fuel costs in 2015.
About 7.4 billion shares changed hands on U.S. exchanges, above the 6.7 billion average for the last five sessions, according to BATS Global Markets.
-With additional reporting by Chuck Mikolajczak.
What to watch Thursday:
At 8:30 a.m. Eastern time, the Labor Department reports weekly jobless claims, and import and export prices for November; the Commerce Department reports retail sales for November.
The Commerce Department reports business inventories for October at 10 a.m.
These selected companies are scheduled to release quarterly financial results: