Stocks turned mixed as financials led the market lower despite JPMorgan's solid earnings results.
Among Dow components, Boeing fell while IBM and Kraft rose.
The S&P 500 slipped, while the tech-heavy Nasdaq gained. The CBOE Volatility Index, widely considered the best gauge of fear in the market, fell below 17.
Among key S&P 500 sectors, technology and utilities rose, while materials and financials slumped.
Stocks intially got a boost from JP Morgan Chase after the second-largest U.S. bank delivered strong results, including earnings of $1.28 per share.
After rising at the beginning of the session, JPMorgan's shares slipped after analysts took a closer look at results, and seemed to focus on some weakness in retail banking.
Analyst Mike Mayo of Credit Agricole also said the bank's earnings show signs a credit contraction is underway.
But Jaime Peters, a banking analyst at Morningstar, said JPMorgan's results were strong in investment banking and asset management, and that weakness in the retail bank reflected an unexpected, and short-term, increase in mortgage servicing costs.
And Peters added, a contraction in consumer loans isn't surprising coming out of the so-called Great Recession.
"People are saving more," Peters said, also noting that a growing number of retiring baby boomers are less likely to spend as well.
"That means consumer loan growth will be hard to come by over the next several years," she says. "That will challenge banks to grow their revenue line."
Bank of America is scheduled to release earnings on Friday.
Wells Fargo ,PNC and Citigroup were among banks leading the financial sector lower.
Commodities sank across-the-board on Tuesday after Goldman Sachs released a report calling for a correction in oil. But some traders viewed Goldman's call as simply a chance to take profits and get back in at a lower level.
General Electric , meanwhile, traded flat after the company said a report it planned to return money to the U.S. Treasury was a hoax. GE is a minority shareholder in NBC Universal, CNBC's parent.
Oil prices rose on Wednesday. London Brent crude rose above $121 a barrel, while U.S. light crude rose above $106. Gold roseabove $1,460 an ounce, while the dollar slipped against a basket of major currencies.
The government reported Wednesday that oil inventories rose 1.6 million barrels, while gasoline inventories fell 7 million barrels.
In M&A activity, Silgan Holdings will buy Graham Packaging for $19.56 a share, or$4.1 billion in a cash and stock deal.
And Schneider Electric is denying it is in takeover talks with Tyco International .
In economic news, retail sales rose 0.4 percent in March, the Commerce Department said on Wednesday. The gain was the weakest since last June, when sales fell 0.3 percent. Economists surveyed by Reuters had forecasted sales to rise 0.5 percent in March.
Excluding autos, retail sales rose 0.8 percent in March compared with a 1.1 percent gain in February.
U.S. business inventories, meanwhile, rose 0.5 percent in February compared to an upwardly revised 1 percent gain in January, the Commerce Department said. Economists surveyed by Reuters had expected inventories to rise by 0.8 percent.
Also in economic news, the Mortgage Banking Association said applications for mortgages and refinancings fell 6.7 percent last week to their lowest levelsince January as interest rates rose.
Investors were waiting for a pivotal speech by President Obama in which the he will explain his vision for tacking the long term US deficit. The President is due speak at 1:30 pm New York time. (The speech will be streamed live on CNBC.com).
The speech follows an agreement on the federal budget on Friday between the White House and Congress. But president Obama still wants Congress to raise the country's borrowing limit before a $14.3 trillion debt ceiling is reached as early as mid May.
The Federal Reserve releases its Beige Book of regional economic conditions at 2 p.m.
On Tap This Week:
WEDNESDAY: Business inventories, oil inventories, 10-year Treasury note auction, Beige Book, United Technologies shareholder meeting; earnings from JPMorgan before-the-bell.
THURSDAY: Weekly jobless claims, PPI, 30-year Treasury bond auction, Kocherlakota speaks, Plosser speaks, Lacker speaks, Nestle shareholder meeting; earnings from Hasbro before-the-bell and Google after-the-bell.
FRIDAY: CPI, Empire state manufacturing survey, Treasury international capital, industrial production, consumer sentiment, credit card default rates reported; Evans speaks, Hoenig speaks, G24/International Monetary Affairs meeting; Earnings from Bank of America and Mattel before-the-bell.
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