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Stocks decline as plunge in energy shares, global worry overshadow Apple rally

U.S. stocks fell Wednesday, sending the Dow Jones Industrial Average to its biggest two-day loss in a year, as energy shares plunged and concern grew about international risks to the American economy and weakness in multinational earnings.

Energy companies slumped 3.9 percent as a group after oil retreated. Apple Inc. climbed 5.7 percent after reporting a record $18 billion in quarterly profit, one of the biggest in corporate history. Boeing Co. advanced 5.4 percent as it posted a quarterly profit that beat analysts’ estimates.

The Standard & Poor’s 500 Index fell 1.4 percent to 2,002.16. The Dow Jones Industrial Average lost 195.84 points, or 1.1 percent, to 17,191.37. The gauge fell 2.8 percent over two days, the most since February 2014. The Nasdaq 100 Index dropped 0.6 percent, erasing an earlier rally of 1.7 percent.

“People smell no growth,” Rick Fier, director of equity trading at Conifer Securities LLC in New York, said in an interview. “Currency problems are affecting revenues for multinationals. Greece is becoming a much bigger worry for the markets right now,” he said. “Think about where the market would be today without Apple and Boeing.”

U.S. stocks turned lower after the Fed boosted its assessment of the economy and downplayed low inflation readings while repeating a pledge to remain “patient” on raising interest rates. Losses accelerated in the final hour, pushing declines in the Dow and S&P 500 beyond 1 percent and wiping out gains in the Nasdaq.

Fed officials are confronting divergent economic forces as they weigh the timing of the first interest-rate increase since 2006. Surprisingly strong job gains argue for tightening sooner, while inflation held down by a plunge in oil prices and a cooling global economy provides grounds for delay.

The Fed acknowledge global risks, saying that it will take into account readings on “international developments” as it decides how long to keep rates low.

U.S. futures pared early gains amid concerns over Greece’s new government. New Prime Minister Alexis Tsipras named a cabinet that includes a foreign minister who raised questions over European Union sanctions against Russia and a finance minister who has called Greece’s bailout a trap, while new ministers said they will cease the sale of some state assets and increase the minimum wage.

The S&P 500 is down 4.2 percent from an all-time high reached in December.

Equities opened higher on Wednesday as Apple and Boeing rallied amid quarterly results, a day after benchmark indexes tumbled on concern that a stronger dollar is eroding profits at large companies.

While the dollar’s climb is reducing profits at U.S. companies from Procter & Gamble Co. to Pfizer Inc. and Microsoft Corp., more than 77 percent of Standard & Poor’s 500 Index members have still beaten analysts’ estimates so far this earnings season, according to data compiled by Bloomberg.

Energy shares lost 3.9 percent, the most in three weeks, after oil tumbled as U.S. inventories rose to a three-decade high. Exxon Mobil Corp., Chevron Corp. and Schlumberger Ltd. fell at least 3.3 percent.

Apple jumped 5.7 percent. Net income surged 38 percent, fueled by sales of larger-screened iPhones and refreshed Mac computers that Apple had unveiled in September, part of a barrage of new products from Chief Executive Officer Tim Cook as he sought to revitalize the company’s revenue.

Boeing gained 5.4 percent, the most since 2011, as it beat analysts’ estimates and predicted it would make good in 2015 in converting a record jetliner-order backlog into cash.