U.S. stocks finish mostly lower ahead of Fed‘s monetary policy decision

The Dow Jones Industrial Average and the S&P 500 on Tuesday extended a multisession skid while the Nasdaq booked its second straight gain, highlighting a period of divergence for the benchmarks ahead of the Federal Reserve‘s decision. The Dow closed off by about 67 points, or 0.3%, at 26,495, the S&P 500 index gave up 0.1% at 2,915. The S&P 500 has ended lower the past three days, while the Dow has posted back-to-back declines. However, the Nasdaq Composite Index eked out a second gain in a row, up 0.2% at 8,007, with the technology and internet-centric gauge following the fortunes of Apple Inc. higher for a second straight session. The Fed is widely expected to deliver its third rate increase of 2018 but investors will follow closely the central bank‘s projections for future rate increases as well as comments from Fed Chairman Jerome Powell Wednesday afternoon. Wall Street has been fixated on the developments in trade clashes between China and the U.S., but have managed to post positive returns, amid an apparent escalation of tensions between the economic superpowers. Market participants fret a tit-for-tat dispute between Washington, Beijing and other global partners could spiral into a full-blown trade conflict that crimps corporate profits. However, so far stocks have traded within range of all-time highs as investors focus on the domestic economic strength. Equity benchmarks also met some resistance from rising yields, with the 10-year Treasury note hitting above 3.10%, flirting with its highest level in about seven years, according to Dow Jones Market Data. Bond prices fall as yield rise. Climbing rates follow expectations that the Fed will dial up rates, which can make borrowing costs more expensive for corporations, while also undermining the appeal of risk-free government paper against stocks. Market participants also watched President Donald Trump deliver a speech in front of the United Nationals general assembly in New York, where he criticized the Organization of the Petroleum Exporting Countries for higher crude-oil prices and defended his administrations hard-line trade tactics.

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