Russia tensions hit Wall Street nerves

NEW YORK - U.S. stocks fell Wednesday, led by losses in the technology and materials sectors, as geopolitical concerns rose after the United States and the European Union agreed to work together on tougher sanctions against Russia.

Trading was choppy, with stocks mostly positive in the morning after U.S. economic data pointed to improving conditions. The Commerce Department reported that orders to U.S. factories for long-lasting manufactured goods rose in February by the largest amount since November, 2.2 percent. Demand for airplanes and automobiles drove the gains.

But the major indexes reversed course in the afternoon as technology stocks turned sharply lower.

The Dow Jones industrial average slipped 98.89 points, or 0.60 percent, to close at 16,268.99. The Standard & Poor's 500 index dropped 13.06 points, or 0.70 percent, to finish at 1,852.56. The Nasdaq composite fell 60.69 points, or 1.43 percent, to close at 4,173.58.

Among technology stocks, Facebook was one of the biggest losers, a day after the social-networking company said it would acquire two-year-old Oculus VR Inc., a maker of virtual-reality glasses for gaming, for $2 billion. Facebook shares ended down 6.9 percent at $60.39.

A sharp drop in the stock of King Digital Entertainment Plc., maker of the popular Candy Crush Saga game, also soured investor sentiment.

King's stock fell 15.6 percent to close at $19 in its trading debut Wednesday, after the initial public offering valued the company at about $6 billion. King was the most actively traded stock on the New York Stock Exchange.

Biotech stocks, which have sold off sharply in recent sessions, extended their losses. The Nasdaq biotechnology index slid 1.9 percent to end at 2,455.84.

The S&P materials-sector index tumbled 1.4 percent and ranked as the biggest decliner among the 10 index sectors.

U.S. Treasury yields fell slightly after the auction. The benchmark 10-year U.S. Treasury note was up 12/32, its yield at 2.6901 percent.

Two- and five-year notes have been the worst performers since Federal Reserve chair Janet Yellen said last week that the U.S. central bank could raise interest rates six months after its current bond-buying program ends, suggesting a potential rate hike as early as spring 2015.

In precious-metals trading, spot gold was at $1,303.60 an ounce after plumbing a five-week bottom of $1,300.09.

The United States and the European Union agreed to work together to prepare possible tougher economic sanctions in response to Russia's actions in Ukraine. The sanctions could include the energy sector.

"This could be a non-event if the market wasn't at the level that it is now," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York. "Because we are still near a record high, this kind of geopolitical news can make investors more nervous."