Stocks slip as market leaders look "extended"

Markets mostly closed lower on Wednesday.

The S&P 500 fell less than 0.1 percent while the STOXX Europe 600 and the Nikkei 225 both fell by 0.1 percent.

Financial stocks were among the biggest losers as JP Morgan Chase and Bank of America both said at an industry conference on Wednesday that trading is weakening in the second quarter.

Ian Winer, head of the equities division at Wedbush Securities, said he was “concerned that there are quantitative models out there that are ‘buy high, buy higher’”.

In contrast, Colin Cieszynski, chief market strategist at CMC Markets, said he thinks “some traders are starting to throw in the towel”.

Kevin Marder at MarketWatch noted that the rally has been narrow, involving mainly the largest growth stocks.

While Marder acknowledged that a rally led by quality growth stocks tends to be healthy, the current leaders are nearly all “technically extended above their most recent support areas”, and this “should signal caution as to fresh-money buys”.