Dow Falls 293 as Investors Cash Out

Despite the pullback Wednesday, Bruce McCain, head of the investment strategy team at Key Private Bank in Cleveland, said recent trading -- days when stocks didn't plummet in the face of bad news and rallied on good news -- is encouraging because it could signal the market is closer to regaining solid footing.

He said while any placidity in the markets would likely need to last for some time to extinguish some of investors' fears, he was encouraged by some recent signs of strength in consumer discretionary and financial stocks.

"Those are probably the two most important sectors with respect to this market regaining some confidence and maybe starting to shift gears," he said.

Wall Street has beaten up stocks like those of financial companies in recent months in favor of energy, materials and industrials. Investors hoping for a change in the winds on Wall Street will be looking for signs that money is moving out of these defensive areas into downtrodden corners of the market, McCain said.

Declining issues outpaced advancers by about 2 to 1 on the New York Stock Exchange, where volume came to 1.56 billion shares.

The Russell 2000 index of smaller companies fell 10.15, or 1.49 percent, to 671.78.

Overseas, Japan's Nikkei stock average increased 2.48 percent, while Hong Kong's Hang Seng index rose 2.26 percent. Britain's FTSE 100 closed down 1.07 percent, Germany's DAX index fell 0.50 percent, and France's CAC-40 declined 0.58 percent.