Stocks Close Near Lows; Apple Below $500

Stocks closed lower Wednesday, with the Dow logging its sharpest decline this year, amid ongoing worries over Greece, following the Federal Reserve's latest meeting minutes, and as Apple slumped.

Apple tumbled to close below $500 a share, weighing on the S&P and Nasdaq.

The Dow Jones Industrial Average slumped 97.33 points, or 0.76 percent, to end at 12,780.95, posted its worst session in 2012, led by BofA and United Tech .

The S&P 500 dipped 7.27 points, or 0.54 percent, to finish at 1,343.23. The Nasdaq dropped 16.00 points, or 0.55 percent, to close at 2,915.83.

The CBOE Volatility Index, widely considered the best gauge of fear in the market, jumped above 21.

All 10 S&P sectors finished in the red, led by industrials and techs.

The Fed minutes showed a few officials in January felt another round of bond buyingwould be needed before long to support the U.S. economy. The debate took place at a meeting in which the Fed decided to hold its benchmark interest rate at record lows until at least late 2014.

Earlier, Chinese central bank governor said China will continue to invest in euro zone debt, helping to keep the market higher. But the gains were overshadowed following reports that the euro zone finance ministers may delay bailout payments to Greece, while still avoiding a disorderly default.

“The market’s having a little bit of trouble right now despite the fact that China’s so confident that a Greek deal is going to be done," said Scott Nations, president and CIO of NationsShares.

Nations said he expects the S&P to see some headwind, but it doesn't necessarily imply a selloff ahead.

"We might consolidate and move sideways for a while, which would relieve the overbought situation,” he said.

Among earnings, Comcast rallied after the parent company of NBCUniversal posted results that exceeded expectations, thanks to better-than-expected video and Internet subscribers. The firm also hiked its dividendand announced a share buyback program.

Dean Foods surged to lead the S&P 500 gainers after the food and beverage manufacturer posted earnings that beat expectations, but the firm gave a cautious full-year outlook.

Abercrombie & Fitch jumped sharply after the teen apparel retailer said it expects gross margins to recover "significantly" this year, thanks to falling cotton costs and rising international sales.

Zynga reported better-than-expected results, but shares of the social network game developer tumbled after the firm showed slowing sequential bookings in the first half of 2012. Analysts were mixed on the stock—at least three brokerages cut their ratings on the firm, while five boosted their price targets.

CBS , NetApp and Nvidia are among companies that are slated to post results after-the-bell tonight.

Bank of America reversed their gains as analysts piled on the financial giant with doubts that its surge over the past two months is sustainable. Bernstein Research cut its rating on the firm to "market perform" on fears that the company has little earnings power in 2012.

Kellogg said it will acquire the Pringles business divisionfrom Procter & Gamble for $2.7 billion, after P&G ended its deal with troubled food producer Diamond Foods .

Meanwhile, Capital One was approved by the Fed to acquire ING's U.S. online banking unit. The purchase will mark the biggest U.S. bank deal since the Dodd-Frank law of 2010 mandated stricter merger reviews.

On the economic front, the Empire State survey, the monthly gauge of manufacturing in the state of New York, improved more than expected. And homebuilder sentiment index climbed in February to its highest level in more than four years, according to the National Association of Home Builders.

Shares of homebuilders including Pulte , Beazer and D.R. Horton rallied following the report.

However, industrial production wasunexpectedly flat in January, according to a Federal Reserve report. Meanwhile, the Fed revised December's industrial production to show a 1 percent gain instead of the previously reported 0.4 percent increase.

—Follow JeeYeon Park on Twitter: @JeeYeonParkCNBC

Coming Up This Week:

THURSDAY: Housing starts, jobless claims, PPI, Bernanke speaks at FDIC hearing, Philadelphia Fed survey; earnings from GM, Applied Materials, Baidu, Nordstrom
FRIDAY: CPI, leading indicators; Earnings from Campbell Soup, Heinz

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