Stocks fell as positive economic news on jobs and the trade deficit sent the dollar higher for a third day.
The Dow Jones Industrial Average fell more than 15 points after slipping in Tuesday's session as well as concerns over European sovereign debt pushed the dollar higher against the euro.
Boeing , Pfizer and AT&T led the blue-chip index down,while Chevron and Bank of America rose.
The S&P 500 Index was flat, while the Nasdaq rose slightly. The CBOE Volatility Index, widely considered the best gauge of fear in the market, traded above 19.
Among key S&P sectors, energy, consumerdiscretionary and financials rose, while healthcare and consumer staples fell.
Investors were focused on how the G20 meeting in Seoul later this week will affect currency prices. Meanwhile, the dollar continued to rise against a basket of currencies as European debt troubles once again take center stage. Stocks have been moving inversely to the dollar.
The good news on the jobs front should have given more support to the market, said Tim Speiss, head of personal wealth advisors at at EisnerAmper, but he isn't concerned that a short downdraft will interrupt the upward trajectory for stocks.
That's because large cap stocks are valued at less than 10 times earnings today versus 30 to 35 times earnings 10 years ago, Speiss said. And today, companies have cleaned up their balance sheets and are running much leaner and more efficiently, so they are poised to do well, particularly as the economy gains strength, he said.
"What valuations are now compared to 10 years ago portends that large cap equities will do very well," Speiss said.
The rise in U.S. jobless claims pushed gold prices down from record highs, as investors became skittish about silver after the Chicago Mercantile Exchange raised margin requirementsfor silver futures.
The debate over the impact of the Fed's quantitative easing would not be raised at the G20, according to one G20 official. But the summit is expected to produce an agreement on a more flexible foreign exchange policy.
A debate over currency markets has been raging all week after comments from World Bank President Robert Zoellick in the Financial Times were interpreted as a call for a return to the gold standard. Zoellick has since told CNBC that he is not in favor a gold-backed currency system, but a more international currency arrangement with less dollar weighting.
Boeing shares led the Dow lower for most of the session Wednesday after a 787 test flight was forced to make an emergency landing.
And Assurant's shares plummeted to the bottom of the S&P 500 after news in the American Banker that the insurer is involved in "forced-placed insurance" schemes involving mortgage servicing.
In earnings news, General Motors' third-quarter profit released Wednesday morning beat rivals Ford and Chrysler, which lost $84 million. The earnings report is expected to be GM's last before its initial public offering in November.
Macy's shares were slightly higher after the department store chain reported higher than expected sales, crediting its strategy of catering to local tastes as well as improved sales at its Bloomingdale's chain.
Elsewhere, upscale retailer PoloRalph Lauren jumped higher after reporting a 16 percent increase in fiscal second-quarter earnings and posting an optimistic outlook.
Campbell Soup dropped after the company said earnings for next year will rise only 2 percent to 4 percent, down from its previous forecast of a 5 percent to 7 percent increase, citing slowing sales despite discounting.
Invesco's shares fell after news Morgan Stanley sold its stake in the investment manager for a 7.4 percent discount to Invesco's closing price on Tuesday.
BJ's Wholesale , meanwhile, soared after a report in the New York post that the big-box retailer was considering options, including a sale to a private-equity firm.
On the economic front, initial claims for unemployment fell by 24,000 to 435,000from a revised 459,000 for the week ended Nov. 6, according to the Labor Department. The four-week moving average of claims fell to 446,500, the lowest since September 2008. The news was a positive sign for jobs growth.
Also, import prices rose 0.9 percent in October, while export prices rose 0.8 percent, narrowing the trade deficit, as the weaker dollar gave a boost to U.S. exports.
Mortgage loan applicationsfor both home loans and refinancings rose for the week ended Nov. 5, as interest rates remained at record lows, the Mortgage Bankers Association said. The MBA's seasonally adjusted index rose 5.8 percent.
On Tap This Week:
WEDNESDAY: Oil inventories, CFTC hearing on Dodd-Frank, 30-yr bond auction, after-the-bell earnings from Cisco.
THURSDAY: Veterans Day – Bond market closed, stocks and futures markets open, G20 mtg. begins, Earnings from Kohl’s, Disney and Nvidia.
FRIDAY: APEC CEO summit, Consumer sentiment, Earnings from DR Horton and JCPenney.
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