WASHINGTON (dpa-AFX) - After ending the previous session mostly higher, stocks have given back some ground in morning trading on Tuesday. Selling pressure has remained relatively subdued, however, limiting the downside for the major averages.
Currently, the major averages are stuck in negative territory but off their lows of the session. The Dow is down 155.35 points or 0.6 percent at 26,429.42, the Nasdaq is down 62.97 points or 0.6 percent at 10,473.30 and the S&P 500 is down 7.91 points or 0.2 percent at 3,231.50.
A negative reaction to earnings news from Dow components 3M (MMM) and McDonald's (MCD) is contributing to the weakness on Wall Street.
Shares of 3M are down by 5.3 percent after the diversified manufacturer reported second quarter results that missed analyst estimates on both the top and bottom lines.
McDonald's is also slumping by 2.2 percent after the fast food giant reported weaker than expected second quarter earnings on a slightly bigger than expected drop in comparable-restaurant sales.
On the other hand, shares of Pfizer (PFE) have jumped by 3.1 percent after the drug giant and Dow component reported better than expected second quarter results and raised its full-year guidance.
The pullback by stocks also comes after the Conference Board released a report showing consumer confidence deteriorated by more than expected in the month of July.
The Conference Board said its consumer confidence index slumped to 92.6 in July after jumping to an upwardly revised 98.3 in June.
Economists had expected the consumer confidence index to pull back to 95.7 from the 98.1 originally reported for the previous month.
The bigger than expected drop by the index came as consumers grew less optimistic about the short-term outlook for the economy.
'Large declines were experienced in Michigan, Florida, Texas and California, no doubt a result of the resurgence of COVID-19,' said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.
She added, 'Such uncertainty about the short-term future does not bode well for the recovery, nor for consumer spending.'
Nonetheless, overall trading activity is somewhat subdued as traders look ahead to the Federal Reserve's monetary policy announcement on Wednesday.
While the Fed is widely expected to leave interest rates unchanged, traders may look to the accompanying statement for clues about future plans to provide additional economic stimulus.
Semiconductor stocks are seeing considerable weakness in morning trading, giving back ground after moving sharply higher on Monday.
After surging up by 3.2 percent in the previous session, the Philadelphia Semiconductor Index is sliding by 1.4 percent.
Significant weakness has also emerged among steel stocks, as reflected by the 1.3 percent drop by the NYSE Arca Steel Index. The index ended the previous session at its best closing level in well over a month.
Computer hardware, chemical and oil stocks are also seeing notable weakness on the day, while tobacco, utilities and airline stocks have shown strong moves to the upside.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan's Nikkei 225 Index fell by 0.3 percent, while China's Shanghai Composite Index advanced by 0.7 percent.
The major European markets have also turned mixed on the day. While the U.K.'s FTSE 100 Index has risen by 0.4 percent, the French CAC 40 Index is down by 0.1 percent and the German DAX Index is down by 0.2 percent.
In the bond market, treasuries are regaining ground following the drop seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 2.5 basis points at 0.584 percent.
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