By Wallace Witkowski, MarketWatch , Ryan Vlastelica

Dow on pace to see ninth drop out of the past 10 sessions

U.S. stocks on Wednesday struggled to break higher, with the Nasdaq Composite outpacing its equity-benchmark brethren, as stock investors digested hawkish comments from Federal Reserve speakers and an energy-sector bolstering drop in U.S. gasoline inventories.

The Dow Jones Industrial Average fell 41 points, or 0.2%, to 20,661, with shares of UnitedHealth Group Inc.(UNH) and Cisco Systems Inc. (CSCO) the largest decliners. The Dow has been in a slump of late, ending lower for nine of the past 10 sessions. Although it popped 0.7% on Tuesday, boosted by a strong read on consumer confidence, the benchmark remains 2.4% below an all-time high reached March 1.

Meanwhile, the S&P 500 index rose 3 points, or 0.1%, to 2,361. Energy (XLE) was the day's largest gainer, with the sector up 1.2% following bigger-than-expected declines (http://www.marketwatch.com/story/oil-prices-rise-to-session-highs-as-eia-reports-drop-in-us-gasoline-supplies-2017-03-29) in gasoline and distillate stockpiles in the latest week, a positive sign for demand. Chesapeake Energy Corp. (CHK) shares rallied 10% while Hess Corp.(HES) jumped 4.7% and Marathon Oil Corp.(MRO) shares rose 4.6%.

Gains in energy did most of the heavy lifting, as five of the S&P 500's 11 primary sectors traded in the green. Financials, which have been big gainers in recent months, led decliners, falling 0.5%.

Meanwhile, the Nasdaq Composite Index climbed 17 points, or 0.3%, to 5,892.

"It's going to be touch-and-go until earnings season and then the entire conversation is going to change," said Karyn Cavanaugh, senior market strategist at Voya Financial, in an interview. "We're probably going to get double-digit earnings growth this quarter, showing that things are getting better even without [President Donald Trump's] Administration changes."

First-quarter earnings, with the bulk of reports coming out starting mid-April, are expected to grow by 9.1% for the first quarter, in what would be the largest year-over-year quarterly gain since the fourth quarter of 2011, according to John Butters, senior earnings analyst at FactSet. Voya's Cavanaugh feels that will easily become a double-digit gain since estimates are traditionally conservative.

"Today is just a pause," said Randy Frederick, vice president of trading and derivatives for Charles Schwab. "Valuations are a bit stretched, but that's nothing unusual. Meanwhile, economic data remains strong and markets are optimistic that we'll see progress on tax reform out of Washington."

Traders are also tracking the U.K.'s invocation of Article 50, which officially starts its withdrawal from the European Union.

"This has never happened before, so no one knows how it will play out," Frederick said. "It's an important event, but I'm not sure it's a negative event, at least as far as the market goes."

Economic news and Fed speakers: Chicago Fed President Charles Evans said the fundamentals of the economy were good (http://www.marketwatch.com/story/feds-evans-says-he-supports-one-or-two-more-interest-rate-hikes-this-year-2017-03-29-91033510), and called for another one or two interest-rate increases in 2017. The Fed raised rates at its March meeting, and most investors expect a total of three this year.

Boston Fed President Eric Rosengren said the central bank should set a default of a rate increase every other meeting this year, (http://www.marketwatch.com/story/feds-rosengren-wants-a-rate-hike-at-every-other-meeting-this-year-2017-03-29) while San Francisco Fed President John Williams said he sees three more rate hikes this year.

In the latest economic data, pending-home sales rose 5.5% in February (http://www.marketwatch.com/story/pending-home-sales-jump-in-february-2017-03-29), with their rising to their highest level in nearly a year.

Opinion:The 'reflation' trade since Trump's election might be going in the other direction (http://www.marketwatch.com/story/the-reflation-trade-since-trumps-election-might-be-going-in-the-other-direction-2017-03-29)

Stock movers: Shares in Vertex Pharmaceuticals Inc.(VRTX) surged 21% a day after the company's drug for cystic fibrosis met endpoints in two late-stage clinical studies (http://www.marketwatch.com/story/vertex-pharma-shares-jump-on-cystic-fibrosis-study-results-2017-03-28).

Restoration Hardware parent RH(RH) jumped 15% a day after the home furnishings retailer's better-than-expected earnings (http://www.marketwatch.com/story/restoration-hardware-parent-shares-rally-on-earnings-beat-2017-03-28).

Amazon.com Inc.(AMZN) shares surged to a record high (http://www.marketwatch.com/story/amazons-stock-surges-to-record-high-as-retail-dominance-drives-investor-interest-2017-03-29) of $872.50 and were last up 1.8% as one analyst said that the company's "retail dominance" was driving investor interest.

Mylan NV(MYL) shares fell 2.6% after the Food and Drug Administration didn't approve (http://www.marketwatch.com/story/mylan-stock-sinks-2-fda-fails-to-approve-its-generic-asthma-medication-2017-03-29)the company's generic version of GlaxoSmithKline PLC's (GSK.LN) Advair Diskus asthma treatment.

Dave & Buster's Entertainment Inc.(PLAY) fell 3.4% after delivering a disappointing guidance (http://www.marketwatch.com/story/dave-busters-shares-down-6-after-earnings-beat-but-weaker-growth-2017-03-28), while Sonic Corp.(SONC) rallied 6.1% after its results (http://www.marketwatch.com/story/sonic-shares-slip-after-revenue-misses-street-view-2017-03-28).

Other markets:Oil futures (http://www.marketwatch.com/story/crude-oil-marches-higher-ahead-of-us-supply-data-2017-03-29) traded 2.1% higher. European stocks (http://www.marketwatch.com/story/european-stocks-inch-higher-as-traders-wait-for-brexit-kickoff-2017-03-29) finished higher as the U.K. triggered its exit from the EU while the British pound was dropping on Brexit trigger day (http://www.marketwatch.com/story/british-pound-under-pressure-ahead-of-brexit-trigger-2017-03-29). Asian markets closed mostly with gains (http://www.marketwatch.com/story/asia-pacific-stocks-post-gains-after-wall-streets-rebound-2017-03-28). Gold futures (http://www.marketwatch.com/story/gold-drops-in-back-to-back-sessions-as-dollar-sellers-stand-down-2017-03-29) settled down 0.2% at $1,253.70 an ounce, and a key dollar index rose 0.3%.

Read:How to trade the pound as Theresa May pulls the Brexit trigger (http://www.marketwatch.com/story/avoid-being-short-with-the-crowd-how-to-trade-the-pound-as-may-pulls-brexit-trigger-2017-03-28)

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--Victor Reklaitis in London contributed to this article.

 

(END) Dow Jones Newswires

March 29, 2017 14:31 ET (18:31 GMT)

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