Equities ended mostly lower Wednesday as weak economic data fed the view that a slowdown is under way, and that corporate profits are headed down too. The Dow industrials firmed 0.2 percent, the S&P 500 declined 0.3 percent, and the Nasdaq was off 0.6 percent. US Treasury yields, the dollar, and oil prices all declined.

Stocks faced selling pressure as they continued to consolidate after their recent gains. Investors digested a series of downside data surprises including Wednesday's ADP payrolls report, a soft ISM services reading, and news of a wider trade deficit. These added to Tuesday's softer job openings report to feed the narrative that the economy is slowing, with an added kick from tighter bank credit. Markets are increasingly pricing in no further Federal Reserve rate increases and the prospect of rate cuts later in the year.

The recent rally in oil prices faltered on the view that demand is likely to fade as the global economy slows. Megacaps retreated to weigh on the major averages. Among sectors, worst were materials, industrials, real estate, consumer discretionary, and information technology. Holding up best were defensives including utilities, health care, and consumer staples.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.