FDS FactSet Research Systems Inc

By Sue Chang and Ellie Ismailidou, MarketWatch

Valeant plunges 52% for its worst daily percentage drop on record

U.S. stocks closed mostly lower Tuesday, weighed by a rout in oil prices and a string of lackluster economic data, ahead of the Federal Reserve's important decision on interest rates.

The S&P 500 slipped 3.71 points, or 0.2%, to close at 2,015.93. Consumer-staples, utilities, telecommunications services and tech were the only sectors to finish in positive territory. The Dow Jones Industrial Average rose 22.40 points, or 0.1%, to close at 17,251.53, buoyed by a healthy advance in Apple Inc., while the Nasdaq Composite shed 21.61 points, or 0.5%, to end at 4,728.67.

Hesitancy among investors to make big bets before the Federal Open Market Committee's delivers its outlook on the economy as well as its projection for rate increases, on top of instability in crude prices, supported investors' cautious posture, said Kristina Hooper, U.S. investment strategist at Allianz Global Investors.

April West Texas Intermediate crude , the U.S. crude benchmark (http://www.marketwatch.com/story/oil-prices-struggle-to-recover-from-mondays-bruising-session-2016-03-15), slid 84 cents, or 2.3%, to settle at $36.34 a barrel, its lowest settlement since March 4.

"The stock market fell under pressure early due to soft retail sales data. Our view has been a healthier consumer is key for U.S. growth to remain on a stable footing. Retail sales data over the past few months have done little to provide a signal of a stable consumer," said Rob Haworth, senior investment strategist for U.S. Bank Wealth Management.

Investments in stocks and sectors traditionally viewed as safety plays, mainly utilities and consumer staples, reflected the "lack of confidence in the rally," said John Conlon, chief equity strategist at People's United Wealth Management.

Despite a roughly 10% rise from the February lows, the run-up in equities has been characterized by anemic trading volumes (http://www.marketwatch.com/story/will-a-lack-of-volume-doom-this-rally-2016-03-11), which implies that the rebound may be short-lived, according to Conlon.

Also read:Buy these stocks if you are bearish on oil, Goldman Sachs says (http://www.marketwatch.com/story/buy-these-stocks-if-youre-bearish-on-oil-goldman-sachs-says-2016-03-14)

On the U.S. economic front, sales at U.S. retailers dipped in February (http://www.marketwatch.com/story/retail-sales-in-february-fall-for-second-straight-month-2016-03-15), and January turned out to be more disappointing than initially estimated, new government figures showed on Tuesday. And U.S. wholesale prices fell 0.2% in February (http://www.marketwatch.com/story/us-producer-prices-fall-02-in-february-2016-03-15-81033630) to mark the fifth decline in seven months, largely because of lower gasoline and food prices.

But a reading of New York-area manufacturing conditions (http://www.marketwatch.com/story/empire-state-factory-index-has-first-positive-reading-in-eight-months-2016-03-15) improved markedly in March, a sign that the factory sector could be stabilizing after months of weakness. And confidence among home builders (http://www.marketwatch.com/story/home-builder-sentiment-treads-water-in-march-nahb-says-2016-03-15) held steady in March, while business inventories rose slightly.

(http://www.marketwatch.com/story/buy-these-stocks-if-youre-bearish-on-oil-goldman-sachs-says-2016-03-14)The dollar (http://www.marketwatch.com/story/dollar-leans-on-yen-as-investors-assume-bank-of-japan-isnt-finished-easing-2016-03-15) was down sharply against the yen in the wake of the Bank of Japan decision. Gold prices were under pressure while Treasury yields were mixed.

Fed in focus again

The Fed's two-day meeting is slated to conclude with a policy decision on Wednesday at 2 p.m. Eastern, followed by a news conference with Fed Chairwoman Janet Yellen. Most expect the Fed to leave monetary policy unchanged (http://www.marketwatch.com/story/fed-may-have-little-reason-to-pause-but-it-will-2016-03-14), but many economists expect at least one interest-rate increase this year.

While the economic backdrop has improved, the possibility of another rate increase makes investors wary about holding riskier assets, such as stocks, said Naeem Aslam, chief market analyst at Ava Trade, in a note.

As important as the Fed's decision is its policy statement and Yellen's conference, which will offer clues about the central bank's game plan for normalizing monetary policy and its outlook for global growth.

Read:Caroline Baum says Fed officials talk themselves into a corner (http://www.marketwatch.com/story/fed-officials-talk-themselves-into-a-corner-2016-03-15)

Stocks to watch

Shares of Valeant Pharmaceuticals International Inc. (VRX.T) plunged 52%, its largest single-session percentage drop on record, to end at $33.51 after the Canadian drugmaker cut guidance for the current quarter and provided preliminary results for its final quarter of the year that were short of Wall Street's expectations (http://www.marketwatch.com/story/valeant-pharma-slashes-quarterly-forecast-2016-03-15). The company also indicated that it may default on some of its debt.

Apple (AAPL) closed up 2% after Morgan Stanley said demand for the iPhone (http://www.forbes.com/sites/jaysomaney/2016/03/15/apple-shares-up-in-pre-market-trading-on-morgan-stanley-note/#5d2f15437a9a)for the first quarter of 2016 is tracking ahead of analysts' expectations.

FactSet Inc. (FDS) ended 5.3% down despite reporting that profit rose 10% in the latest quarter (http://www.marketwatch.com/story/factset-profit-tops-views-as-sales-rise-2016-03-15), as the financial information provider notched sales gains amid a higher user base.

Avon Products Inc.(AVP) finished down 8.2% after announcing Monday that it would cut around 2,500 jobs and shift its corporate headquarters to the United Kingdom (http://www.marketwatch.com/story/avon-to-cut-2500-jobs-move-headquarters-to-uk-2016-03-14).

--Barbara Kollmeyer contributed to this article.

(END) Dow Jones Newswires

March 15, 2016 17:13 ET (21:13 GMT)

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