Wall Street gives up rally try
Stocks erase gains, with the Dow ending lower on weak bank, oil and consumer stocks.
NEW YORK (CNNMoney.com) -- Stocks abandoned gains Wednesday, with the Dow ending a choppy session lower, as investors pled exhaustion after the recent six-week advance.
The Dow Jones industrial average (INDU) fell 83 points, or 1%. The S&P 500 (SPX) index lost 6 points or 0.8%. The tech-laden Nasdaq composite (COMP) gained 2 points, or 0.1%.
After the close, Apple (AAPL, Fortune 500) reported higher quarterly sales and earnings that topped estimates. Shares gained 1% in extended-hours trading.
Also after the close, eBay (EBAY, Fortune 500) reported lower quarterly sales and earnings that topped forecasts, sending shares 7% higher in extended-hours trading.
Reports are due Thursday morning from UPS (UPS, Fortune 500), PepsiCo (PEP, Fortune 500), Raytheon (RTN, Fortune 500) and Amgen (AMGN, Fortune 500).
Economic reports are due Thursday on weekly jobless claims and existing home sales for March.
Stocks seesawed through the early afternoon, moving in tune with the volatile financial sector. A late-session rally petered out in the last minutes of the session.
Stocks have been choppy this week in the aftermath of a 6-week advance that sent the S&P 500 29% percent higher, after it fell to 12-year lows.
"We had a huge short-covering rally and there's no question the momentum has slowed down," said Fred Dickson, chief market strategist at D.A. Davidson & Co.
Short-covering refers to a process by which traders who have sold equities short to take advantage of a falling market need to buy them back.
"But the psychology has changed from the fear of being in the market when there's another shoe set to drop to the fear of not being in the market when there's another big up leg on the way," he said.
Corporate results: Morgan Stanley (MS, Fortune 500) reported weaker quarterly sales and earnings that missed expectations and also slashed its dividend 81%. Shares fell 9%. (For details, click here).
Morgan Stanley was the first of the big banks to miss forecasts, after Citigroup (C, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and Goldman Sachs (GS, Fortune 500) all reported better-than-expected profits.
But a number of other profit reports or forecasts were less negative.
Wells Fargo (WFC, Fortune 500) reported higher-than-expected quarterly sales and earnings thanks to strength in its mortgage business. The company had warned a week ago that it expected to report a better-than-expected profit. Shares eased 3.4%.
Also Wednesday, Dow component AT&T (T, Fortune 500) reported a smaller-than-expected drop in quarterly profit that topped forecasts. AT&T shares gained 1.8%.
Fellow Dow stock McDonald's (MCD, Fortune 500) also reported lower quarterly profit that topped estimates. The stock fell 2.5%.
Boeing (BA, Fortune 500) reported lower quarterly profit that missed estimates. Yet, shares gained nearly 2% after the company forecast lower full-year earnings that were still better than what analysts were expecting.
SanDisk (SNDK) reported a smaller-than-expected quarterly loss, propelling shares of the flash-memory maker by 13%.
Late Tuesday, Yahoo (YHOO, Fortune 500) reported lower quarterly sales and earnings that topped estimates. The company also said it would cut 5% of its workforce. Shares were little changed Wednesday.
Company news: General Motors (GM, Fortune 500) was in focus in the afternoon after it said it won't make a payment of $1 billion by June 1, but will instead cut debt through a debt-for-stock offering or through court protection. Shares were little changed, erasing earlier losses.
Caterpillar (CAT, Fortune 500) shares added 3.4% after JPMorgan Chase lifted its rating on the stock to "overweight" from "neutral," Reuters reported.
Ford Motor (F, Fortune 500) shares rallied 12.6% after Goldman Sachs upgraded both the U.S. auto sector and Ford stock, Reuters reported.
In other news, David Kellermann, the acting chief financial officer of mortgage finance firm Freddie Mac, was found dead in an apparent suicide, police said.
Geithner: Stocks staged a late-session advance Tuesday, after Treasury Secretary Timothy Geithner defended Treasury's Troubled Asset Relief Program (TARP) and other efforts to stabilize the financial system.
Speaking Wednesday, Geithner talked about the need for global cooperation amid the unprecedented economic crisis. He spoke at the Economic Club of Washington D.C. ahead of a meeting of world finance ministers later this week.
Bonds: Treasury prices tumbled, raising the yield on the benchmark 10-year note to 2.94% from 2.89% Tuesday. Treasury prices and yields move in opposite directions.
Lending rates were mixed. The 3-month Libor rate was unchanged from 1.10% Tuesday, according to Bloomberg.com. The overnight Libor rate rose to 0.21% from 0.21% Tuesday. Libor is a bank-to-bank lending rate.
Other markets: In global trading, Asian markets ended lower with the exception of the Nikkei. European markets ended higher.
In currency trading, the dollar fell versus the euro and the yen.
U.S. light crude oil for June delivery rose 30 cents to settle at $48.85 a barrel on the New York Mercantile Exchange.
COMEX gold for June delivery rose $9.80 to settle at $892.50 an ounce. 
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