Investing.com -- U.S. stocks fell sharply on Wednesday, amid the largest one-day sell-off in Wal-Mart (N:WMT) shares in nearly two decades and mixed results from third quarter earnings of a host of prominent banks.
Wal-Mart, the world's largest retailer, announced that its earnings per share could decline as much as 12% next year due to higher wages, lower prices and a wide range of technology investments. The multinational retailer also said it would invest several billion dollars over the next three years in its online, e-commerce business, as well as on initiatives to raise wages for entry-level workers.
Meanwhile, global economic conditions continue to weigh on the retail giant. Wal-Mart CEO Doug McMillon told CNBC on Wednesday morning that the effects from a stronger dollar could reduce the company's full-year revenue in 2015 by $15 billion. In fiscal year 2016, Wal-Mart expects to invest up to $1.5 billion in its global e-commerce division in an effort to become more competitive with online rival Amazon.com Inc (O:AMZN).
Wal-Mart's slump weighed on the major U.S. indices, ending the session as the worst performer on the Dow Jones Industrial Average and the S&P 500 Composite index. The Dow lost 157.68 or 0.92% on Wednesday to 16,924.21, while the S&P 500 fell 9.46 or 0.47% to end the session at 1,994.23. On the S&P 500, eight of 10 sectors closed in the red, as stocks in the Consumer Services, Financials and Industrials sectors lagged. Stocks in the Basic Materials and Energy industries led, each gaining at least 0.95% on the session.
The NASDAQ Composite index, meanwhile, dropped 13.76 or 0.29% to 4,782.85, closing lower for the second straight session.
Shares in Bank of America Corporation (N:BAC) and Wells Fargo & Company (N:WFC) were mixed, even as both major banks beat analysts' forecasts with its third quarter revenues and earnings on Wednesday. Bank of America (N:BAC) shares gained 0.11 or 0.71% to 15.64, after reporting earnings of $4.51 billion on the quarter, amid significant declines in legal costs for a third straight quarter. Wells-Fargo shares, though, fell 0.55 or 1.05% to 51.50, after reporting third quarter earnings per share of 1.05, narrowly above analysts' expectations. Shares in JPMorgan Chase & Co (N:JPM) fell nearly 3% to 59.74, one day after the largest bank in the U.S. missed analysts' revenue and earnings expectations for the quarter.
The top performer on the Dow was Intel Corporation (O:INTC), which gained 0.73 or 2.28% to 32.77. Wal-Mart finished as the Dow's worst performer, dropping 6.63 or 9.93% to 60.11. The sell-off wiped off more than $20 billion from Wal-Mart's market capitalization on Wednesday.
The biggest gainer on the NASDAQ was TripAdvisor Inc (O:TRIP), which surged 16.77 or 25.15% to 83.46, after the Massachusetts-based travel website announced a comprehensive room booking deal with Priceline. The worst performer was Dollar Tree Inc (O:DLTR), which fell 2.11 or 3.32% to 61.35. Shares in Dollar Tree (O:DLTR) are still up by more than 13% this year.
TripAdvisor was also the top performer on the S&P 500, just ahead of SanDisk Corporation (O:SNDK) which gained 7.03 or 11.38% to 68.80. Wal-Mart also finished just below Best Buy Co Inc (N:BBY), which lost 2.19 or 5.91% to 34.85.
Netflix Inc (O:NFLX) is scheduled to report its third quarter results after the close of trading.
On the New York Stock Exchange, declining issues outnumbered advancing ones by a 1,839-1,254 margin.