Stocks - S&P Pulls Back as Investors Take Some Profits Ahead of Fed

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Stocks - S&P Pulls Back as Investors Take Some Profits Ahead of Fed
Credit: © Reuters.

Investing.com – The big stock market rally lost some steam Tuesday as four days of sizable gains produced the inevitable profit-taking.

Technology shares, especially giants like Apple (NASDAQ: AAPL ), Google parent Alphabet (NASDAQ: GOOGL ) and Microsoft (NASDAQ: MSFT ), led the pullback.

The S&P 500 hit a new intraday high of 3,047.87 early in the session but pulled back to a 0.08% loss.

The Dow Jones industrials dropped a modest 0.07%. The Nasdaq Composite slid 0.59% and the Nasdaq 100 index fell 0.78%.

Alphabet's earnings miss on Monday was probably the biggest reason for the tech pullback. But Apple, down 2.3%, had the bigger impact on the Dow and especially the Nasdaq 100. The decline cut 39 points from the Dow and nearly 22 points from the Nasdaq 100.

Apple (NASDAQ: AAPL ) reports fiscal-fourth-quarter results after Wednesday's close. Analyst estimates compiled by Investing.com project earnings of $2.83 a share, down slightly from a year ago. Revenue is estimated at $62.9 billion, up 2.4%. But the fiscal first quarter is the biggest revenue and profit generator.

It also looked as if traders were surprised by a report that the phase one U.S.-China Trade Deal might not be ready when President Donald Trump and President Xi Jinping meet next month in Chile.

Part of the malaise also was the inevitable uncertainty ahead of a Federal Reserve rate decision due Wednesday at 2 PM ET (18:00 GMT). Wall Street believes a rate cut is coming. Investing.com's Fed Rate Monitor tool puts the odds of a quarter-point cut to at 97.3%.

There was some ugly selling in Beyond Meat (NASDAQ: BYND ), down 22.1% following its IPO lockup period, and GrubHub (NYSE: GRUB ), which plunged 43%, on weak guidance.

There was some excitement about a Wall Street Journal report that Fiat Chrysler Automobiles (NYSE: FCAU ) is in merger talks with French automaker Peugeot (OTC: PUGOY ). Fiat Chrysler was up about 7.6%.

Adding some additional support to the market was strength in healthcare, materials and energy stocks.

Gold futures fell modestly to $1,490.70 an ounce. West Texas Intermediate crude fell 27 cents to $55.54. Brent crude was up 2 cents to $61.59.

Interest rates dipped lower with the 10-Year Treasury yield dropping to 1.835% from Monday's 1.853%.

Oil-and-gas equipment supplier National Oilwell Varco (NYSE: NOV ), Xerox (NYSE: XRX ), consumer products maker Leggett & Platt (NYSE: LEG ) and hospital operator HCA Holdings (NYSE: HCA ) were among the top S&P 500 performers on the day.

S&P laggards were led by fiber-laser maker IPG Photonics (NASDAQ: IPGP ), water-heater maker AO Smith(NYSE: AOS ), oil-and-gas producer TechnipFMC (NYSE: FTI ) and supermarket giant Kroger (NYSE: KR ).

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