NEW YORK (TheStreet) -- Stocks slipped on Wednesday for a second straight session and crude oil prices took a hit after U.S. inventories expanded at a faster-than-expected rate, leading to a selloff among energy companies. 

The S&P 500 fell 0.73%, the Dow Jones Industrial Average fell 0.76%, and the Nasdaq declined 0.62%.

U.S. crude oil inventories increased 10.3 million barrels over the week ended Feb. 27, up from 8.4 million barrels in the prior week, according to the Energy Information Administration. The total was more than double an expected increase of 4.2 million barrel. West Texas Intermediate crude slipped 0.3% to $50.38 a barrel.

The energy sector was the worst performer on the S&P 500. Large-cap oilers including Exxon Mobil (XOM) - Get Report and Chevron (CVX) - Get Report tumbled, while the Energy Select Sector SPDR ETF (XLE) - Get Report dropped 1%. 

The ISM Non-Manufacturing Index improved to 56.9 in February from 56.7 a month earlier, an unexpected increase as economists expected a slide to 56.5. Business activity slipped slightly, down to 59.4 from 61.5. 

Service sector activity expanded in February with the U.S. PMI Services Index climbing to a four-month high of 57.1 from 54.2 in January. Economists had expected a reading of 54.8. 

ADP said 212,000 jobs were added to private payrolls in February, a touch lower than in January. The reading was less than an expected 220,000 increase.

"Job growth is strong, but slowing from the torrid pace of recent months," said Mark Zandi, chief economist of Moody's Analytics. "Job gains remain broad-based, although the collapse in oil prices has begun to weigh on energy-related employment. At the current pace of growth, the economy will return to full employment by mid-2016."

The Bureau of Labor Statistics will release the U.S. jobs report for February on Friday. Expectations are for 235,000 jobs to have been added to nonfarm payrolls compared to 257,000 a month earlier. The unemployment rate is forecast to tick down 100 basis points to 5.6%.

Abercrombie & Fitch (ANF) - Get Report slumped more than 9% after quarterly sales tumbled nearly 14% and comparable-store sales fell 10%. Fellow teen retailer American Eagle Outfitters (AEO) - Get Report jumped 7.2% after fourth-quarter earnings of 36 cents a share beat estimates by 2 cents and revenue climbed 3%.

Bob Evans Farms (BOBE) tanked 21% after reporting earnings below estimates and announcing it won't pursue a sale or spinoff of its BEF Foods segment. TiVo (TIVO) - Get Report jumped 3% after beating quarterly earnings and revenue forecasts on an increase in customer subscriptions. 

Target (TGT) - Get Report was slightly higher after announcing plans to cut thousands of jobs in a restructuring designed to reduce costs by $2 billion over two years. At its analyst day presentation, the retailer also guided for 2015 earnings as high as $4.65 a share, above analysts' estimates of $4.50 a share.

Firearms manufacturer Smith & Wesson (SWHC) jumped nearly 12% after beating analysts' estimates on its top- and bottom-lines. The company also raised its full-year earnings forecast as high as 89 cents a share from a previous 78 cents.

China's services sector grew slightly in February. The HSBC/Markit purchasing managers' index ticked up to 52 over the month from 51.8 in January. China's Shanghai Composite added 0.51%.

"The solid rise in new orders suggests that activity growth may pick up in the months ahead," said Markit's Annabel Fiddes in a statement.

European markets fell back from earlier gains following the best increase in retail sales in nearly 10 years. Retail sales in the eurozone increased 3.7% in January. Markit's purchasing managers' index for the eurozone rose to 53.7 in February, higher than 52.7 in January, though lower than a preliminary reading of 53.5.