S&P 500, Dow ease after recent gains; Nasdaq ends at record

(Reuters) – The S&P 500 and Dow fell on Tuesday after recent strong gains, while the Nasdaq ended at an all-time high for a second straight day after briefly rising above the 10,000 mark for the first time.

FILE PHOTO: Traders wearing masks work, on the first day of in person trading since the closure during the outbreak of the coronavirus disease (COVID-19) on the floor at the New York Stock Exchange (NYSE) in New York, U.S., May 26, 2020. REUTERS/Brendan McDermid

Investors eyed this week’s Federal Reserve meeting. While no major policy announcements are expected when the U.S. central bank wraps up its two-day meeting on Wednesday, investors will scrutinize its remarks on the health of the economy, which has been reopening after coronavirus-related closures.

The Nasdaq’s gains came a day after the index became the first of Wall Street’s main indexes to confirm a new bull market after hitting a low on March 23.

The benchmark S&P 500 fell back into negative territory for the year after erasing those losses on Monday.

“It strikes me as maybe a reflexive selloff as a result of a tremendous rally over the past week. There’s no news headline that screams bearish catalyst to me. But conversely, other than the nonfarm payrolls data, the past two weeks haven’t had super bullish catalysts either,” said Mike Zigmont, head of trading and research at Harvest Volatility Management in New York.

“In the grand scheme of things, it seems like the market has caught a bullish fever, and it’s feeding on itself.”

The rally in U.S. stocks accelerated last week after strikingly upbeat May jobs data strengthened views that the worst of the economic fallout from the pandemic was over.

Financial, industrial and energy stocks, which have surged in recent weeks on hopes of an improved economic outlook, were the biggest drags on the benchmark S&P 500 on Tuesday.

Unofficially, the Dow Jones Industrial Average fell 296.99 points, or 1.08%, to 27,275.45, the S&P 500 lost 25.06 points, or 0.78%, to 3,207.33 and the Nasdaq Composite added 29.01 points, or 0.29%, to 9,953.75

U.S. financial market operators, including the New York Stock Exchange, held a moment of silence in honor of George Floyd, a 46-year-old African American who died on May 25 after a white police officer knelt on his neck for nearly nine minutes.

The S&P 1500 airlines index tumbled, while cruise operators Carnival Corp and Norwegian Cruise Line Holdings Ltd fell following their recent sharp recovery amid recent signs of a pickup in global travel.

Additional reporting by Medha Singh and Devik Jain in Bengaluru; Editing by Cynthia Osterman

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