The S&P 500 and the Nasdaq pared earlier losses on Tuesday as caution set in ahead of an anticipated interest rate cut from the Federal Reserve, while declines in healthcare stocks weighed on the Dow.

Investors are largely still pricing in a 25 basis-point cut from the U.S. central bank at the conclusion of its two-day meeting on Wednesday, to offset the deterioration in the U.S. labor market, evidenced by numerous recent economic indicators.

Data on Tuesday showed that U.S. retail sales increased more than expected in August, but that did little to change rate cut expectations.

“Any kind of resilient economic data will only reaffirm the hawks on the FOMC … and could give a little bit of fuel for (Fed Chair Jerome) Powell to come out as slightly more hawkish than the market is hoping fo

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