U.S. Stocks Retreat Ahead of Fed Announcement
U.S. stocks ended mostly lower Tuesday, as consumer confidence slid to a five-year low and the technology sector lifted slightly by upbeat earnings from Corning, while the broad market kept a cautious tone ahead of the Federal Reserve's decision on interest rates on Wednesday.
Helping to lift tech stocks, Corning shares rose 3.3 percent as the group said its first-quarter profit tripled on LCD sales. Shares of pharmaceutical giant Merck put pressure on the Dow, after losing 10 percent as the Food and Drug Administration rejected its cholesterol drug Cordaptive, one of the key drugs in its pipeline.
Other drug stocks were under pressure on Tuesday, with Biogen Idec and Genentech falling more than 5 percent each after receiving negative news on their Lupus drugs.
The Standard & Poor's 500 Index lost 5.42 points, or 0.4 percent, to 1,390.95, its second straight decline. The Dow Jones Industrial Average slipped 39.81, or 0.3 percent, to 12,831.94. The Nasdaq added 1.7, or 0.1 percent, to 2,426.1
McGraw-Hill, owner of rating agency Standard & Poor's and publications like BusinessWeek, rose 2.3 percent after saying its profit plunged 44 percent in the first quarter to $81.1 million.
The dollar firmed on rising expectations that the Fed will signal a pause in rate cuts Wednesday. Crude-oil futures fell sharply, losing over $3 to end at $115.63 a barrel. On Monday, crude surged to a new record of $119.93 amid supply concerns.
The Fed's interest-rate meeting begins Tuesday afternoon. The statement will be released on Wednesday at 2:15 p.m. Est.
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