Stocks Turn Lower As Note On Banks Spooks Traders

TIM PARADIS

NEW YORK (AP) — Spooked traders unraveled a rally in stocks late Wednesday as a downbeat assessment of a bank touched off fears that the market is getting overheated.

The Dow Jones industrial average ended down 92 points after having risen 78 points earlier in the day to a new high for the year.

Analysts pointed to a note on Wells Fargo & Co. from banking analyst Richard Bove as the source of the drop, but also said a mix of complacency and lingering concerns about the pace of the market's climb in the past seven months left stocks ripe for a hit.

Joe Saluzzi, co-head of equity trading at Themis Trading LLC, said the note was a reminder of troubles still in the economy and was enough to scare many traders.

"They all ran for the exits at the same time," he said.

The slide in the final hour of trading was reminiscent of the types of big swings seen a year ago at the height of the financial crisis. But analysts said the reasons for the latest slide had been building throughout the day: Major stock indexes touched their highest levels in a year, the dollar extended its drop, oil rose above $82 a barrel and Wal-Mart Stores Inc. said it was cutting prices, a sign that consumers are still struggling.