New York – Wall Street battled back from sharp losses Tuesday to close mostly flat as investors sought buying opportunities and adjusted their holdings ahead of the Federal Reserve’s meeting on interest rates.
Stocks were down for most of the session on concerns about what central bankers might say about the economy. However, the drop – the first for the Dow Jones industrials in six sessions – did make some prices look more attractive ahead of today’s meeting.
Data released Tuesday showed the economy continues to sputter.
The Commerce Department reported wholesalers’ inventories grew at a slower rate in March, failing to meet projections. Meanwhile, the National Association of Realtors lowered its forecast for the housing market this year because of stricter lending standards and subprime woes.
Economic reports are expected to wield more influence on the direction of stocks as earnings announcements slow. The latest data did little to change expectations policymakers will leave rates unchanged, though Wall Street will really be looking for further direction about whether a hoped-for rate cut is in the offing.
“There’s this wait-and-see pullback with regard to what the Fed might do (today),” said Janna Sampson, a portfolio manager for Oakbrook Investments. “Given the run we’ve had, and a pretty strong start of the year, this might be a case of investors positioning their portfolios a little sooner than usual before the summer doldrums.”
The Dow Jones industrial average fell 3.90, or 0.03 percent, to 13,309.07. The blue chip average had been up 24 of the last 27 sessions, and surpassed the 13,300 mark for the first time on Monday.
Fixed-income investors placed optimistic bets ahead of the Fed meeting, sending bonds higher.
