U.S. STOCKS FLUNCTUATE NEAR TWO-WEEK LOWS AMID DRAGHI COMMENTS

U.S. stocks fluctuated, after the Standard & Poor’s 500 Index fell Tuesday to its lowest level in two weeks, as European Central Bank President Mario Draghi said more time is needed to consider whether risks to the economic outlook warrant a step-up in stimulus.

The S&P 500 Index fell 0.2 percent to 1,939.07 at 9:52 a.m. in New York, after falling 1.2 percent yesterday. The Dow Jones Industrial Average slipped 36.95 points, or 0.2 percent, to 16,293.52. The Nasdaq Composite Index lost 0.2 percent.

Draghi said in remarks today before European Parliament lawmakers that the macroeconomic environment is “more challenging,” and renewed downside risks have emerged. He also said the ECB won’t hesitate to act if risks increase.

Similar to the Federal Reserve, Draghi’s comments suggest the ECB is also having a hard time assessing the impact of slowing growth in developing countries. “More time is needed to determine in particular whether the loss of growth momentum in emerging markets is of a temporary or permanent nature and to assess the driving forces behind the drop in the international price of commodities and behind the recent episodes of severe financial turbulence,” the central banker said.

Equities have been volatile in recent weeks amid uncertainty over the trajectory of U.S. interest rates and the impact on global growth from a slowdown in China. Stocks tumbled at the end of last week after the Fed held off raising borrowing costs, and gained on Monday after central bank officials said a 2015 rate increase is still warranted and that the domestic economy is improving.

The Chicago Board Options Exchange Volatility Index jumped the most since August’s selloff on Tuesday as companies from energy to autos slumped. The measure of market turbulence known as the VIX has closed above 20 for 22 straight sessions, the longest stretch since June 2012. The gauge rose 1.9 percent Wednesday to 22.86.

Meanwhile, the ratio of puts to calls on the Standard & Poor’s 500 Index has surged 12 percent over the past week, signaling investor appetite for protection against losses. That’s the most pronounced five-day jump since 2009, with the biggest increase coming the day after the Fed’s rate decision last week.

Fed Chair Janet Yellen said last week that policy makers would scrutinize slowing growth in China and emerging markets for risks that could spill over to the U.S. Still, the market is split on whether the Fed will raise rates this year. Traders are pricing in a roughly 42 percent chance of liftoff in December, while about 51 percent are betting on January.

Chinese shares in Hong Kong slid the most in three weeks on Wednesday after a gauge of manufacturing dropped to the lowest level since 2009.

The S&P 500 had climbed 6.8 percent from its August low before the Fed unveiled its decision last Thursday to leave interest rates near zero. The benchmark has slumped 2.6 percent through Tuesday since the meeting concluded, and was down 8.8 percent from its all-time high in May.