U.S. stocks drifted lower on Tuesday, moving away from record highs as investors awaited the start of a Federal Reserve meeting that is expected to outline where interest rates will move.
The S&P 500 (^GSPC) fell 0.3%, while the tech-heavy Nasdaq Composite (^IXIC) fell about 0.2% on the heels of both all-time closing highs. The Dow Jones Industrial Average (^DJI) fell 0.4%.
Stocks have managed to advance amid market uncertainty about an economy that could be too hot or too cold for comfort. A string of inconclusive data has fueled skepticism about the likelihood of three rate cuts in 2024, as the Fed considered in March. Many investors now expect just one reduction before the end of the year.
The Fed’s two-day policy meeting that begins Tuesday is expected to end with borrowing costs held at their highest level in two decades. Investors will keep an eye out for clues on when a shift to cuts will take place, with September or November in the frame.
Learn more: How does the labor market affect inflation?
Investors calculating the odds of a rate cut are also eagerly awaiting May consumer price data, due Wednesday, given its crucial role in the Fed’s deliberations.
Looking at individual stocks, shares of Apple (AAPL) were little changed following losses the previous session after the iPhone maker’s big AI debut. Meanwhile, shares of Eli Lilly (LLY) jumped after the pharmaceutical maker’s early-onset Alzheimer’s treatment gained unanimous support from a panel of FDA advisers.
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