U.S. equities retreated from record levels on Wednesday as early-year momentum faded in some of the market’s strongest sectors.
The S&P 500 slipped 0.34% to close at 6,920.93, while the Dow Jones Industrial Average dropped 466 points, or 0.94%, finishing at 48,996.08. Both indexes had touched fresh all-time highs earlier in the session. The Nasdaq Composite edged higher, gaining 0.16% to end at 23,584.27.
Financials and energy — two sectors that led gains at the start of 2026 — came under pressure, each falling more than 1%. Major bank stocks including JPMorgan, Bank of America, and Wells Fargo ended lower, while energy heavyweights Exxon Mobil, Chevron, and ConocoPhillips lagged the broader market.
Oil prices declined after President Donald Trump said interim authorities in Venezuela would deliver up to 50 million barrels of crude to the U.S., raising concerns about increased global supply. Crude extended losses from Tuesday, even as stocks had rallied earlier in the week with investors largely dismissing worries tied to the U.S. strike on Venezuela.
Markets also reacted to comments from Trump criticizing the defense industry. The president said he would not allow defense contractors to issue dividends or conduct share buybacks until his concerns with the sector are addressed, sending defense stocks lower.
In addition, Trump announced plans to restrict large institutional investors from purchasing more single-family homes, weighing on private equity firms such as Blackstone and Apollo Global Management.
On the upside, oil refiners outperformed. Shares of Valero Energy rose about 3%, while Marathon Petroleum gained more than 1%, benefiting from lower crude prices.
Frequently Asked Questions
Why did the S&P 500 and Dow pull back after hitting record highs?
Profit-taking emerged in sectors that led earlier gains, particularly financials and energy, causing indexes to retreat from intraday records.
Why did energy stocks fall while refiners gained?
Oil prices dropped on expectations of increased supply from Venezuela, pressuring producers, while refiners benefited from lower input costs.
How did President Trump’s comments impact markets?
Remarks targeting defense contractors and restrictions on institutional home purchases weighed on defense and private-equity stocks.
Why were bank stocks under pressure?
Financials declined as early-year momentum cooled and investors reassessed valuations following strong recent gains.
What should investors watch next?
Upcoming economic data, inflation trends, and policy signals that could influence interest-rate expectations and market direction.
