Stocks end lower after Yellen's rate comments

Stocks gave up early gains and ended slightly lower Wednesday after Federal Reserve Chair Janet Yellen said that a rate hike at its December meeting is "a live possibility."

The drop snapped a two-day Wall Street rally that kicked off November and helped catapult the Dow Jones industrial average back into positive territory for 2015, positioned the Standard & Poor's 500 to within 1% of a new record close, and pushed the small-company Russell 2000 out of correction territory.

The Dow, which started the day about 80 points shy of the key 18,000 level, ended down 51 points, or 0.3%. The S&P 500 fell 0.4%, finishing just 2 points above the 2100 level. The broad-based index started the day 21 points below its May 21 all-time high of 2130.82. The Nasdaq composite, which is up 8.6% this year, dipped 0.05% into the red.

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Yellen: Rate hike next month is 'live possibility'

The recent rally has been fueled by a better-than-expected third-quarter earnings season for Corporate America, a decision by the Federal Reserve in October to hold off on interest rate hikes and a belief that fears about a hard landing in China's economy might have been overblown.

But Yellen's comments Wednesday adds further evidence the Fed is prepared to start raising rates for the first time in nearly a decade at its next meeting. The Fe'd key interest rate has been near zero since the 2008 financial crisis.

In economic news:

Payroll processor ADP said private employers added 182,000 jobs in October, in a possible sign that employment growth largely bounced back after a two-month slump.

ADP: Businesses added 182,000 jobs in October

In earnings action today, media giant Time Warner topped earnings estimates handily and also beat revenue estimates.

Yesterday's rally on Wall Street spread to other global markets Wednesday. Japan's Nikkei 225 closed up 1.3%, Hong Kong's Hang Seng index climbed 2.2% and mainland China's Shanghai composite soared 4.3%.

Shares were trader higher in Europe as well with the Stoxx Europe 600 up 0.7%.

Adam Shell on Twitter: @adamshell.