By Victor Reklaitis, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks took a small step back on
Tuesday, with the S&P 500 easing from a record close and on
pace to end a two-session winning streak.
Inspiration for huge moves was lacking, given an absence of
major U.S. economic reports on Tuesday. Investors tracked U.S.
budget talks and continued to weigh whether a stimulus reduction
will come at next week's Federal Reserve meeting. Mixed economic
reports out of China also provided an uncertain backdrop.
The S&P 500(SPX) was last down 3 points, or 0.2%, to 1,805
after briefly turning positive, while the Dow Jones Industrial
Average (DJI) slipped 30 points, or 0.2%, to 15,995.
The Nasdaq Composite (RIXF) shed 2 points, or 0.1%, to 4,067
after also trading in positive territory.
Bruce Bittles, chief investment strategist at Robert W. Baird
& Co., said tax-related selling could weigh on the market in
early December, before stocks experience their usual late-December
rally.
Bittles also said Tuesday that he doesn't expect a tapering in
the central bank's bond-buying program will come next week. He
suggested tapering news "may still keep the market on edge" -- but
perhaps shouldn't.
"How many times can you discount the same news?" Bittles told
MarketWatch. "I think it's already built into the market."
Mark Luschini, chief investment strategist at Janney Montgomery
Scott, said investors are most focused on two items: an emerging
Washington budget deal, which faces a Dec. 13 deadline, and the Fed
policy-setting meeting on Dec. 17-18. The market has grown more
accustomed to taper news, but there will still be some near-term
repercussions, he told MarketWatch.
"There is still an element of sensitivity to it," Luschini said
on Tuesday.
On Monday, the S&P 500 nudged higher to a record close as
Fed taper talk appeared to leave investors largely unfazed. Follow
MarketWatch's live blog of Tuesday's stock-market action.
* The buzz: Muted action might be all that we get this month as
the holiday season looms. "The market malaise will probably linger
through the rest of the month, with the possible exception of next
week's Federal Reserve meeting," wrote MarketWatch's Shawn Langlois
in the latest Need To Know column.
* Today's movers & shakers: Lululemon Athletica Inc. lost
0.4% after the athletic clothing retailer named a new CEO and said
founder Chip Wilson will resign as chairman. Toll Brothers Inc. was
little changed after paring gains that came following the home
builder's better-than-expected quarterly earnings. Read more in the
Movers & Shakers column.
* Today's economic news: The National Federation of Independent
Business said its small-business optimism index rose 0.9 points to
92.5 in November. Separately, the Labor Department said job
openings at U.S. workplaces rose to 3.93 million in October . None
of Tuesday's economic headlines are expected to be as significant
as Friday's upbeat jobs report or next week's Fed meeting, where
the central bank may decide to reduce its bond-buying program that
has boosted equities.
* Other markets: Asian stocks closed lower after China reported
a slowdown in industrial production, though retail sales came in
higher than forecast. European equities ended lower. Gold was
sharply higher, while oil prices gained.The dollar was slightly
lower against other major currencies.
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