Stocks close lower following cautious comments from Fed Chair PowellDow -516.81 at 23247.97, Nasdaq -139.38 at 8863.19, S&P -50.12 at 2819.87 [BRIEFING.COM] The S&P 500 lost 1.8% on Wednesday in a broad-based decline, as investors respected some cautious commentary from Fed Chair Powell. The Dow Jones Industrial Average declined 2.2%, the Nasdaq Composite declined 1.6%, and the Russell 2000 declined 3.3%. In his speech prior to the open, Fed Chair Powell said the economic outlook remained highly uncertain and subject to significant downside risks, adding that a recovery may take some time to gather momentum. Mr. Powell also said the Fed can do more to help the financial system but dismissed the notion of implementing negative interest rates. The S&P 500 did trade in positive territory for a moment after the open, but sellers quickly regained control with losses broadening out to all 11 S&P 500 sectors. The energy (-4.4%) and financials (-3.0%) sectors took the biggest hits, while the consumer staples (-0.9%) and utilities (-0.9%) sectors declined less than 1.0%. Investors were reminded today that part of the economic uncertainty referenced by Fed Chair Powell included U.S-China tensions and hurdles in COVID-19 testing. The latter was noted by a New York University study that suggested Abbott Lab's ($ABT 92.16, -1.64, -1.8%) COVID-19 test is prone to false negatives. Adding to U.S.-China tensions, the FBI confirmed that China-affiliated cyber actors have targeted U.S. organizations conducting COVID-19-related research. Also, a report out of China indicated that Beijing is mulling punitive countermeasure on the U.S. as a result of lawsuits that are seeking COVID-19-related damages. Separately, valuation concerns were voiced by a couple of influential names. Legendary investor Stanley Druckenmiller said the risk-reward for equity is maybe as bad as he's seen it in his career. Appaloosa Management's David Tepper told CNBC that he hasn't seen the market this overvalued since 1999. U.S. Treasuries ended the session slightly higher. The 2-yr yield declined one basis point to 0.15%, and the 10-yr yield declined three basis points to 0.65%. The U.S. Dollar Index increased 0.3% to 100.25. WTI crude declined 1.6%, or $0.42, to $25.34/BBL. Reviewing Wednesday's economic data: The Producer Price Index for final demand declined 1.3% m/m in April (Briefing.com consensus -0.5%), marking its biggest decrease since records began in December 2009. Most of that decline was attributed to a 3.3% drop in prices for final demand goods.The Producer Price Index for April may not be convincing enough to the Fed to go down the negative interest rate road, yet the key takeaway is that it will certainly keep it on the path at the lower bound.The weekly MBA Mortgage Applications Index increased 0.3% following a 0.1% increase in the prior week. Looking ahead, investors will receive the weekly Initial and Continuing Claims report and Export and Import Prices for April on Thursday. Nasdaq Composite -1.2% YTDS&P 500 -12.7% YTDDow Jones Industrial Average -18.5% YTDRussell 2000 -26.1% YTD Market Snapshot Dow23247.97-516.81(-2.17%)Nasdaq8863.19-139.38(-1.55%)SP 5002819.87-50.12(-1.75%)10-yr Note -4/320.653NYSEAdv 325 Dec 2594 Vol 1.1 blnNasdaqAdv 623 Dec 2620 Vol 4.2 bln Industry Watch Strong: Consumer Staples, UtilitiesWeak: Financials, Energy, Industrials Moving the Market -- Stocks close lower following cautious commentary from Fed Chair Powell-- Powell cautions about prolonged economic recovery, suggests more stimulus may be needed -- Broad-based decline with weakness in the energy and financials sectors-- Valuation concerns, U.S.-China tensions, COVID-19 testing not perfect ECONOMIC EVENTS: In U.S. data, the Producer Price Index report for April followed yesterday's CPI lead with a 1.3% record decline for the headline and a 0.3% drop for the core PPI. Fed Chair Jerome Powell, in a speech on current economic issues at the Peterson Institute for International Economics, said that "the scope and speed of this downturn are without modern precedent, significantly worse than any recession since World War II." The head of the central bank added: "A loan from a Fed facility can provide a bridge across temporary interruptions to liquidity, and those loans will help many borrowers get through the current crisis. But the recovery may take some time to gather momentum, and the passage of time can turn liquidity problems into solvency problems. Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery." In COVID-19 news, New York Governor Andrew Cuomo reported 166 virus deaths in the state yesterday versus 195 the day before. TOP NEWS: Shares of Royal Caribbean ($RCL) fell more than 5% after the cruise line operator announced that it has commenced a private offering of senior secured notes for an aggregate principal amount of $3.3B. Shares of peer Norwegian Cruise Line ($NCLH) were also 7% lower after Wells Fargo analyst Timothy Conder downgraded that stock to Equal Weight from Overweight with a price target of $14, down from $70. Las Vegas Sands ($LVS) announced the company will discontinue its pursuit of integrated resort development in Japan, with Sands Chairman and CEO Sheldon Adelson stating that "the framework around the development of an IR has made our goals there unreachable." Meanwhile, California Resources ($CRC) shares dropped 7.9% after The Wall Street Journal reported that the company is in talks with lenders around a financing package of up to $600M to carry the oil company through a planned bankruptcy proceeding. MAJOR MOVERS: Among the noteworthy gainers was WW (WW), which rose 4.7% after Jefferies analyst Stephanie Wissink initiated coverage of the stock with a Buy rating and $32 price target. Also higher were United Natural Foods ($UNFI) and Progyny ($PGNY), which gained a respective 45.6% and 27.5% after reporting quarterly results. Among the notable losers was Spirit Airlines ($SAVE), which fell 13.1% after Raymond James analyst Savanthi Syth downgraded the stock to Market Perform from Outperform. Another stock moving lower following an analyst downgrade was Coty ($COTY), which was cut to Neutral from Outperform with a $5 price target by Exane BNP Paribas analyst Mikheil Omanadze. Also lower were Infinera ($INFN) and 8x8 ($EGHT), which dropped 25.3% and 26.4%, respectively, after reporting quarterly results.Source: (Briefing.com)(theFly.com) Disclosure: I may trade in the ticker symbols mentioned, both long or short. 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