Wall Street Slips Ahead of Fed Meeting

NEW YORK (AP) -- Stocks fell on Wall Street Tuesday ahead of several key inflation reports this week and the Federal Reserve's latest interest rate policy decision.

The S&P 500 shed 0.5%. Nearly 90% of stocks in the benchmark index fell. The Dow Jones Industrial Average fell 339 points, or 0.9% and the Nasdaq slipped 0.3% as of 10:01 a.m. Eastern. The weaker trading follows another record-setting day for both the S&P 500 and the Nasdaq.

There was little corporate or economic news for investors to review. General Motors rose 1.2% after the automaker announced that its board approved a $6 billion stock buyback. Fifth Third Bancorp fell 1.9% after cutting its forecast for revenue growth.

Treasury yields fell in the bond market. The yield on the 10-year Treasury slipped to 4.44% from 4.47% late Monday.

The key focus this week comes on Wednesday, when the U.S. releases its latest update on inflation at the consumer level and the Federal Reserve announces its latest update on interest rates. The U.S. will also release its latest update on prices at the wholesale level on Thursday.

Wall Street expects the government's consumer price index to remain unchanged at 3.4% in May. Inflation has seemingly stalled around 3%, complicating the Fed's goal of taming inflation back to its target rate of 2%.

The Fed has held its main interest rate at its highest level in more than two decades and Wall Street is currently hoping for one or two cuts to that rate this year. Virtually no one expects it to move its main interest rate at its current meeting, which starts Tuesday. Policymakers will be publishing their latest forecasts for where they see interest rates and the economy heading.

When Fed officials released their last projections in March, they indicated the typical member foresaw roughly three cuts to interest rates in 2024. That projection will almost certainly fall this time around.

Data on the economy have come in mixed recently, and traders are hoping for a slowdown that stops short of a recession and is just right in magnitude. A cooldown would put less upward pressure on inflation, which could encourage the Federal Reserve to cut rates.

Stocks in Europe fell and stocks in Asia were mixed.