Investors are holding off making big moves while they wait for the Federal Reserve.
Stocks ended mixed but little changed Tuesday, one day after a sell-off. Traders are looking for the central bank to outline its expectations for the economy and signal when it might raise interest rates. The Fed's two-day meeting ends Wednesday.
Investors reacted coolly to a report from the National Association of Realtors that May sales of existing homes rose 2.4 percent. The increase was smaller than economists' forecast for 2.8 percent, and not enough to alleviate investors' anxiety about economic reports later in the week on durable goods orders, new home sales and personal spending.
"There's not a lot of conviction on behalf of buyers," said Jim Herrick, manager of equity trading at Baird & Co.
The Fed is widely expected to keep its key interest rate near zero, but investors are unsure how optimistic the policymakers will be in the economic assessment that accompanies their rate decision, and whether the central bank will consider raising rates later this year to curb inflation.
Analysts say the Fed might dismantle some of the emergency supports it has put in place for the economy, a move that could make investors nervous. At its meeting in March, the Fed introduced $1.2 trillion in spending that included the purchase of $300 billion in government debt to help drive down interest rates. Rates fell, but have since come off their lows, leaving traders divided about whether policymakers will change their strategy.
Meanwhile, the Treasury Department plans to auction $104 billion in government debt this week. The Treasury sold $40 billion in debt Tuesday afternoon and demand was strong. Investors have been on edge around auctions because any signs that demand for government debt is waning could hit the market.
Treasury demand needs to stay strong for the government to finance its bailout and stimulus programs without significantly raising yields. Bond yields also affect borrowing rates for consumers.
The stock market is showing no signs of restarting the rally that lifted the Standard & Poor's 500 index 32.3 percent since early March. Investors who three months ago were buying stocks on improved data like Tuesday's home sales report are now more dubious about when an economic recovery will actually take hold. The Dow Jones industrials shed 201 points on Monday.
The Dow Jones industrial average fell 16.10, or 0.2 percent, to 8,322.91. The Standard & Poor's 500 index rose 2.06, or 0.2 percent, to 895.10, and the Nasdaq composite index fell 1.27, or 0.1 percent, to 1,764.92.
The Dow has fallen for six out of the past seven sessions and closed at its lowest level since May 27.
The biggest loser among the 30 Dow stocks was Boeing Co., which fell $3.03, or 6.5 percent, to $43.87 after again delaying the first test flight of its long-awaited 787 jetliner. The company said it needed to reinforce part of the aircraft.
The stock market rallied sharply between early March and early June, and has given up some ground over the past several days. The Dow on Monday shed 201 points, the worst daily drop in more than two months.
While stocks have been pulling back for weeks, their retreat has been accompanied by very little volatility, and that's a positive sign, said Scott Fullman, director of derivatives investment strategy for WJB Capital Group in New York.
"The fact is, you can't keep going straight up," Fullman said. "There's a chance we'll still see some downward movement in the next week or two — the market really needs a correction."
Government bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, edged down to 3.63 percent from 3.69 percent late Monday.
Falling stocks narrowly outnumbered those that rose on New York Stock Exchange, where consolidated volume came to 4.9 billion shares, down from 5.1 billion shares Monday.
The Russell 2000 index of smaller companies fell 3.04, or 0.6 percent, to 489.77.
After tumbling on Monday, the price of crude oil rose $1.74 to settle at $69.24 a barrel on the New York Mercantile Exchange.
The dollar was mixed against other major currencies. Gold prices rose.
Overseas, Britain's FTSE 100 fell 0.1 percent, Germany's DAX index rose 0.3 percent, and France's CAC-40 fell 0.2 percent. Japan's Nikkei stock average sank 2.8 percent.