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Weak demand seen in Treasury auction

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Disney ( DIS ) shares lower

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Indexes down: Dow 0.5%, S&P 500 0.5%, Nasdaq 0.7%

(Updates to 2:45 p.m. ET)

By Caroline Valetkevitch

NEW YORK, Aug 7 (Reuters) -

U.S. stocks were lower in choppy trading on Wednesday

afternoon, rising early with technology shares and then falling

in tandem with them as investor jitters were stoked by weak

demand in a 10-year Treasury auction.

With investors still nervous after a recent steep

selloff in global stocks, equities pared early gains further

after

the Treasury auction

. Wall Street then turned red, and the S&P technology index

was last down 0.7%.

"There's just a lot to worry about over the next eight

weeks or so, so I'm expecting more voatlilty. I wouldn't be

surprised if after a few days of rally you have another small

selloff," said Peter Tuz, president of Chase Investment Counsel

in Charlottesville, Virginia.

Investors have been worried about a possible U.S.

recession and weaker-than-expected forecasts from U.S.

companies.

The Dow Jones Industrial Average fell 189.15

points, or 0.49%, to 38,808.51, the S&P 500 lost 23.36

points, or 0.45%, to 5,216.67 and the Nasdaq Composite

dropped 108.22 points, or 0.66%, to 16,258.63.

"The yield curve and its constant inversion has people

on edge and the market has generally been priced for perfection

anyway," said Peter Andersen, founder of Andersen Capital

Management in Boston.

"When you see any kind of perturbation in the yields on

the curve, that causes some pause for investors, especially when

there's an auction happening which very sensitive to the current

state of the market."

Stocks got early support when Bank of Japan (BOJ) Deputy

Governor Shinichi Uchida said the central bank would not raise

rates when financial markets are unstable, pushing the yen

lower and boosting market sentiment.

The BOJ's surprise rate hike on July 31 to a level

unseen in 15 years had sparked a global stocks rout as investors

unwound their sharp yen carry trade positions following a surge

in the low-yielding currency, widely used for acquiring

high-yielding assets.

Walt Disney ( DIS ) fell 3.3% as it predicted a "moderation

in demand" at its theme park business in the coming quarters.

Super Micro Computer ( SMCI ) lost 20% after it reported

quarterly adjusted gross margins below estimates. Rival Dell

Technologies ( DELL ) dropped 4.9%.

Markets await more commentary on monetary policy from U.S.

central bank officials next week, in the run-up to the Jackson

Hole, Wyoming, event where Fed Chair Jerome Powell is scheduled

to speak.

Declining issues outnumbered advancing ones on the NYSE by a

1.14-to-1 ratio; on Nasdaq, a 1.67-to-1 ratio favored decliners.

The S&P 500 posted 16 new 52-week highs and 6 new lows;

the Nasdaq Composite recorded 32 new highs and 157 new lows.

(Additional reporting by Shubham Batra and Shashwat Chauhan in

Bengaluru; Editing by Sriraj Kalluvila, Shinjini Ganguli and

David Gregorio)