Stocks pared losses but remained weak after news of a 7.1-magnitude earthquake in northern Japan.
The Dow Jones Industrial Average fell more than 35 points, after dropping nearly 100 immediately after news of the quake. The blue-chip index, which rose slightly on Wednesday to the highest level since June 2008,has fluctuated between a loss of 30 to 100 points since news of the quake.
Among Dow components, General Electric , DuPontand Disney fell, while Boeing and Home Depot gained.
The S&P 500 and the Nasdaq also fell, but were off their lows of the session. The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose above 17.
Among key S&P 500 sectors, telecom, industrials and utilities fell.
The earthquake hitan area 60 miles east of Sendai and 90 miles from Fukushima, near the area devastated by a March 11 earthquake and tsuanmi. Of the hundreds of aftershocks that have followed the earlier quake, none have been 7.0 or stronger.
The earthquake, initially thought to be of a 7.4 magnitude, initially triggered a tsunami warning that has since been lifted.
One reason stock plunged, and continue to trade lower, is the new quake was a reminder as earnings season begins that investors still don't know the full effects of the first quake, said Doreen Mogavero of Mogavero & Lee.
"I think there is a real reason to be concerned how the Japanese economy will effect the rest of the world," Mogavero said, adding that it's not surprising stock prices continue to drop.
"Looking at rate hikes, inflation fears, oil crossing to $109...there are a myriad of things that would cause someone who has made a lot of money off the table," she said.
Before news of the quake, stocks were trading in a narrow range around zero, as the market took a pause after the Dow broke through to a new high on Thursday, and the S&P 500 broke above 1,333, a recent resistance point, largely because investors expect first quarter earnings to be strong, according to Marc Pado, market strategist and technical analyst at Cantor Fitzgerald.
The broad market index hit a high of just under 1,344 on Feb. 18, and remains below that level in part because of the performance of bank stocks, which make up a signfiicant percentage of the index, Pado said.
Investors had expected the Federal Reserve to give more banks clearance to give cash back to shareholders in the form of dividends and buybacks in February, and were disappointed when institutions such as Bank of America didn't get a thumbs up.
"There’s an industry specific issue that’s holding the S&P back," Pado said.