U.S. Stocks Fail To Hold Early Gains, Close Weak Ahead Of Fed Policy

U.S. stocks fell into the red after a positive start on Tuesday, and then stayed weak right till the end of the day’s trading session to close on a negative note.

Investors digested the latest batch of earnings updates and economic data, and looked ahead to the Federal Reserve’s monetary policy announcement, due on Wednesday.

The major averages all fell after opening higher, and ended in negative territory. The Dow ended down 79.75 points or 0.24 percent at 32,653.20, more than 300 points off an early high of 32,975.48. The S&P 500, which climbed to 3911.79 in early trades, settled at 3,856.10, down 15.88 points or 0.41 percent, while the Nasdaq ended down 97.30 points or 0.89 percent at 10,890.85, after rising to a high of 11,156.35 at the start.

The Fed is widely expected to raise interest rates by another 75 basis points, but traders have recently expressed optimism the central bank will signal plans to slow the pace of rate hikes at upcoming meetings.

The optimism was partly offset by a report from the Labor Department showing a jump in U.S. job openings in the month of September.

A separate report released by the Institute for Supply Management showed a slight increase in U.S. manufacturing activity in the month of October.

The ISM said its manufacturing PMI edged down to 50.2 in October from 50.9 in September, but a reading above 50 still indicates growth in the sector. Economists had expected the index to dip to 50.0.

A report from the Commerce Department showed construction spending in the U.S. unexpectedly showed a modest increase in the month of October, inching up by 0.2 percent to an annual rate of $1.811 trillion, after falling by 0.6 percent to a revised rate of $1.807 trillion in August. Economists had expected construction spending to decrease by 0.5 percent.

Shares from transportation, retail, pharmaceutical and housing sectors mostly struggled for support.

Apple Inc (AAPL), Microsoft (MSFT), Salesforce.com (CRM), United Health (UNH) and Merck & Co (MRK) drifted down 1.4 to 2 percent.

JP Morgan (JPM) climbed nearly 2 percent. Nike (NKE), Goldman Sachs (GS) and Caterpillar (CAT) gained 1 to 1.3 percent. Boeing (BA) and Chevron (CVX) posted moderate gains.

Shares of Uber Technologies (UBER) soared 12 percent after the company raised its fourth-quarter operating profit forecast. The compay said it expects fourth-quarter adjusted EBITDA of $600 – $630 million, above analysts’ expectations of a $569.39 million earnings.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index rose by 0.3 percent, while China’s Shanghai Composite Index surged by 2.6 percent.

The major European markets moved higher. The U.K.’s FTSE 100 climbed 1.29 percent, Germany’s DAX gained 0.64 percent, and France’s CAC 40 surged 0.98 percent.

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