Another wild day - this is sounding like a broken record - with the Dow down almost 300 points mid-day until it rebounded later to close just 78 points down.  It's all the same stuff causing the jitters -- uncertainty over the Fed, China, and none of this was helped today when industrial giant Caterpillar Tractor cut its sales forecast and announced 10,000 layoffs.  There should be a little more calm tomorrow since, after close, Janet Yellen gave a speech at U Mass basically confirming that there almost certainly will be a rate hike before year-end, likely December.  This is only the third speech by a Fed official this week that seeks to quell the suspicion since last Thursday's meeting that there may be no hike at all this year.  I think pretty much we can now discard that notion.  The good news for the day was that jobless claims barely budged and sales of new homes rose more than expected.  Volume was more in line with averages at 7.7 billion.

Markets | Thu Sep 24, 2015 7:16pm EDT

Wall Street ends lower as Caterpillar, health stocks weigh

BY SINEAD CAREW

DJ:  16,201.32  -78.57        NAS:  4,734.48  -18.27          S&P:  1,932.24  -6.52

(Reuters)  U.S. stocks closed lower on Thursday in a volatile session on uncertainty about U.S. monetary policy and global economic growth, while market heavyweight Caterpillar cut in its sales forecast and healthcare investors fled for the exits.

Six of the 10 major S&P sectors were lower, with the health sector's .SPXHC 1-percent fall leading the S&P declines and the Nasdaq biotech sector .NBI down 2 percent. Both healthcare indexes had their fifth straight day of losses.

While the broader market pared losses somewhat in the afternoon, investors were cautious ahead of a speech by Federal Reserve Chair Janet Yellen, which could provide clues regarding the timing of an increase in U.S. interest rates.

Yellen, due to deliver an inflation speech at 1700 EDT (2100 GMT), had cited concerns about slowing global growth as a key reason for holding off from a long-anticipated Fed rate hike last Thursday.

Several investment strategists said on Thursday that the market is on its way to retesting the lows of Aug. 24, when shares tanked due to a panic about slowing growth in China.

"From a technical point of view, you have to test that low. Whether it's issues abroad or not being so sure about what's going on here in the U.S. with rates, we need to go lower," said Jeffrey Frankel, co-president of Stuart Frankel & Co in New York.

Almost 7.7 billion shares changed hands on U.S. exchanges, above the average of 7.5 billion in the previous 20 sessions according to Thomson Reuters data.

Shares in Caterpillar (CAT.N), the world's biggest mining and construction equipment maker, closed down 6.3 percent at $65.80, making it the biggest drag on the Dow and the third-biggest weight on the S&P 500. Caterpillar said it could cut up to 10,000 jobs as it faces challenging conditions in key regions and the mining and energy sector.

"The (Caterpillar) news is not helping matters, it's emblematic of a weaker global economy," said Joseph Quinlan, chief market strategist for U.S. Trust, in New York.

The Dow Jones industrial average .DJI fell 78.57 points, or 0.48 percent, to 16,201.32, theS&P 500 .SPX lost 6.52 points, or 0.34 percent, to 1,932.24 and the Nasdaq Composite.IXIC dropped 18.27 points, or 0.38 percent, to 4,734.48.

The CBOE Volatility index .VIX, known as Wall Street's "fear gauge," settled up 6 percent at 23.47, compared with its long-term average of 20.

Gilead Sciences Inc (GILD.O) was the biggest drag on the S&P 500. Healthcare stocks have been under pressure since Hillary Clinton, the leading U.S. Democratic Presidential candidate, vowed earlier this week to stop "price gouging" by drug companies.

Utilities .SPLRCU were the strongest sector with a 0.8 percent rise, while the energy index .SPNY eked out a 0.4 percent gain. U.S. crude oil CLc1 settled higher in what was also a volatile day for the commodity.

A gauge of U.S. business investment plans fell slightly in August, jobless claims barely rose last week, and new single-family home sales rose more quickly than expected in August.

NYSE declining issues outnumbered advancers on the NYSE by 1,816 to 1,235, for a 1.47-to-1 ratio; on the Nasdaq, 1,529 issues fell and 1,244 advanced, for a 1.23-to-1 ratio favoring decliners.

The S&P 500 posted no new 52-week highs and 69 new lows; the Nasdaq recorded 25 new highs and 184 new lows.