Stocks Decline, Led by Energy; Disney Sinks

Stocks skidded amid sliding oil prices and mixed earnings results after rising the three previous sessions.

The Dow Jones Industrial Average dropped more than 70 points after rising more than 75 points on Tuesday.

Walt Disney led the blue-chip average lower following disappointing earnings and revenue results delivered after the market closed on Tuesday. Disney's amusement parks were hurt by the disasters in Japan, and the poor performance of "Mars Needs Moms."

The Dow got some support from Intel, which jumped after the tech firm said Wednesday it would raise its cash dividend by 16 percent to 21 cents a share.

TheS&P 500 and the Nasdaq also fell. The CBOE Volatility Index, widely considered the best gauge of fear in the market, rose above 16.

Most key S&P 500 sectors declined, led by energy and materials, while consumer staples gained.

The energy sector was hurt by sliding prices for oil futures, which added to losses after the U.S. Energy Information Administration said crude inventories grew by 3.8 million barrels last week, which was more than expected. Gasoline futures also sank after news inventories rose by 1.3 million barrels, which was also more than expected.

U.S. light, sweet crude fell more than 2 percent to below $102 a barrel, while in London, Brent crudefell more than 2 percent to below $116.

Anadarko Petroleum ,Apache and ConocoPhillips were among energy stocks leading the sector lower.

Gold and silverfutures fell slightly, while the dollar rose against a basket of currencies.

AIG and the Treasury scaled back plans for share sale, and will now offer$9 billion in AIG stock.

Macy's soared after reporting fiscal first-quarter earnings that topped analysts' estimates. The department store retailer also raised its fiscal 2011 earnings forecast and its dividend.

Toyota traded flat after reporting operating profit fell 52 percent and saying output troubles clouded its outlook.

Johnson & Johnson gained after Goldman Sachs upgraded the pharmaceutical company to "buy" from "neutral," and downgraded Bristol Myers Squibb to "neutral." The brokerage said it now considers Johnson & Johnson the "best underappreciated new product story in US Pharma."

Google fell slightly after news the search engine company set aside $500 million to settle an investigation by the U.S. Justice Department into its advertising practices. The action reduced Google's net income by $5.51 a share in the first quarter.

JPMorgan , meanwhile, declined after Bernstein cut its 2011 earnings estimates for the banking giant's shares.

Globecomm's shares surged after news the satellite-based communications company has hired JPMorgan as a financial advisor, a move some sources say could lead to a sale, according to news reports.

The Treasury will auction $24 billion in 10-year notes at about 1 p.m. Investor Jim Rogers told Reuters late Tuesday that he may start shorting Treasurys soon.

In economic news, the U.S. trade deficit widenedto $48.1 billion in March from $45.44 billion in February, the government reported. In June 2010, the trade gap was $49.94 billion. Analysts surveyed by Reuters had expected the gap to widen to $47 billion.

Exports surged 4.6 percent to $172.7 billion, but imports grew 4.9 percent to $220.8 billion, thanks to rising oil prices.

Also the Mortgage Bankers Association'sseasonally adjusted index of mortgage application activity rose 8.2 percent in the week ended May 6, driven by a drop in interest rates.

China's inflation eased in April as its economy slowed down. That should limit the country's need for monetary tightening. In Europe, the Bank of England raised its medium-term inflation forecast.

On the Calendar This Week:

WEDNESDAY: Oil inventories, Atlanta Fed president speaks, 10-year Treasury note auction, Cleveland Fed president speaks, Minneapolis Fed president speaks, Treasury budget, AIG IPO roadshow, Comcast shareholder meeting, Senate judiciary hearing on AT&T merger; earnings from Cisco and Symantec after-the-bell.
THURSDAY: PPI, retail sales, jobless claims, business inventories, 30-year Treasury bond auction, money supply, NPD video game sales, Ford shareholder meeting, options industry conference; earnings from Kohl's and Macy's before-the-bell, and Nordstrom after-the-bell.
FRIDAY: CPI, consumer sentiment, Transocean shareholder meeting; earnings from Petrobras after-the-bell.

More on CNBC.com

• Best Money Movie Monologues
• 10 Companies That Are Hiring
• Unexpected Origins of Big Companies