The US markets settled lower on Wednesday, extending the pullback seen in the previous session, as bond yields showed a notable rebound after trending lower over the past few sessions. Yields remain well off the highs set last week, but renewed concerns about the outlook for interest rates and inflation weighed on highly-flying tech stocks. The rebound by yields came amid optimism about the coronavirus vaccine rollouts, which had also contributed to an advance by stocks futures before the bond markets opened. President Joe Biden announced the US will have enough vaccine supply for every adult in America by the end of May. Biden cited the emergency use authorization issued for Johnson & Johnson's vaccine as well as a collaboration between J&J and Merck to expand production of the single-dose vaccine.
On the economic data front, payroll processor ADP released a report showing much weaker than expected private sector job growth in the month of February. ADP said private sector employment rose by 117,000 jobs in February after climbing by an upwardly revised 195,000 jobs in January. Street had expected employment to increase by 177,000 jobs compared to the addition of 174,000 jobs originally reported for the previous month. The Institute for Supply Management (ISM) released a report showing a slowdown in the pace of growth in US service sector activity in the month of February The ISM said its services PMI dropped to 55.3 in February from 58.7 in January, although a reading above 50 still indicates growth in the sector. Street had expected the index to come in unchanged.
Dow Jones Industrial Average fell 121.43 points or 0.39 percent to 31,270.09, Nasdaq dropped 361.04 points or 2.7 percent to 12,997.75 and S&P 500 was down by 50.57 points or 1.31 percent to 3,819.72.