Wall Street Today | Dow Snaps Five-day String of Record Closes

U.S. stocks ended sharply lower after a strong year-end rally lost momentum on Wednesday, putting an end to a string of record finishes for the Dow Jones Industrial Average and a pause on the S&P 500's push toward an all-time closing high.

The Dow Jones and Nasdaq Composite was on the way toward a 10th straight day of gains on Wednesday, until the rally was interrupted during the New York afternoon by "a bit of a pause" in reaction to overbought market conditions, according to Peter Cardillo, chief market strategist for Spartan Capital Securities in New York.Investors also seemed hesitant to react to the drop in Treasury yields, Cardillo said via phone, adding that he expects Wednesday's pause to be followed by a resumption of the rally.

The president of the Philadelphia Federal Reserve said Wednesday the central bank doesn't plan to cut interest rates soon because the job on reducing inflation is "not done." Yet he also stressed that he favors keeping interest rates high for a while to make sure the rate of inflation continues to slow toward the Fed's 2% target. Prices are still rising at 3.1% annual rate.

"We should hold rate where they are," Harker said.

U.S. home sales rose in November for the first time since May, in an early sign of a housing-market recovery as mortgage rates begin to fall. Despite interest rates remaining at a multidecade high in November, home sales inched up as aspiring homeowners saw an opportunity to buy.

The U.S. housing market is showing signs of an early recovery as mortgage rates dip below 7% for the first time since August. Falling rates will likely draw out keen home buyers who have been waiting for an opportunity.

Alibaba Group Chief Executive Eddie Wu will take direct control of the company's domestic e-commerce arm, the latest management shuffle at the e-commerce giant as it struggles with new competition from the likes of PDD Holdings in its home market. The change-up represents the latest leadership moves at the e-commerce titan, which after dominating China's e-commerce market for years, has now stumbled on several fronts.