Stocks were slightly lower early Wednesday, Nov. 4, 2015, as...

Stocks were slightly lower early Wednesday, Nov. 4, 2015, as investors evaluated a report on the service industry and a comment from Federal Reserve Chair Janet Yellen that banks are not managing risk well enough. This photo is from Aug. 24, 2015. Credit: AP / Seth Wenig

Stocks closed with losses Wednesday as investors evaluated a comment by Federal Reserve Chair Janet Yellen that banks are still endangering the economy by not managing risk carefully and that policymakers could raise interest rates in December.

At the close on Wall Street, the Dow Jones industrial average was down 50.6 points, about 0.3 percent, at 17,867.6. The Standard & Poor's 500 index had lost 7.5 points, about 0.4 percent, to 2,102.3. The Nasdaq composite fell 2.7 points, about 0.05 percent, to 5,142.5.

CRUDE ENERGY: As the markets closed, the price of benchmark U.S. crude oil was down $1.58, or 3.3 percent, to $46.32 a barrel, reversing after two days of gains. Brent crude, which is used to price international oils, fell $1.96, or 4 percent, to $48.58 a barrel in London.

YELLEN SPEAKS: Yellen's comments pushed the U.S. dollar higher. The dollar's rise had a secondary impact of causing oil to fall, which in turn impacted oil, gas and energy stocks. U.S. government bond prices also fell.

During her regular semiannual testimony to Congress, Yellen said that an interest rate hike in December would be a "live possibility" if the economy stays on track. Yellen did stress that no decision has been made yet and a move in December will depend on how the economy fares between now and then.

At its Dec. 15 and 16 meeting, the Fed will consider raising a key interest rate from a record low of near zero if the economy continues to grow at a strong enough pace to keep adding jobs and push annual inflation toward the Fed's 2 percent target, Yellen said.

Once considered an unlikely scenario, a December rate hike seems more likely by the day. Stocks have recovered nearly all of their losses from the summer, financial markets have calmed in China and elsewhere, and the U.S. economy continues to slowly improve.

Securities that allow investors to bet on which way the Fed will move interest rates are now pricing in a roughly 60 percent chance of the Fed raising rates next month, according to data from the Chicago Mercantile Exchange.

"Everyone is so focused on the world's central banks at the moment they don't seem to care about anything else," said Colleen Supran with the San Francisco-based wealth management firm Bingham, Osborn & Scarborough.

Investors will closely parse the October jobs report, which is due out Friday. Investors expect that U.S. employers added 185,000 jobs last month and that the unemployment rate remained steady at 5.1 percent.

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