US stocks turned lower on Tuesday as investors bide their time until a key inflation report lands and potentially sheds light on the path of interest rates.
By mid-morning trading, all three major indexes reversed earlier session gains. The Dow Jones Industrial Average (^DJI) led the move to the downside, falling about 0.7%, or more than 250 points. The benchmark S&P 500 (^GSPC) dropped about 0.6%, while the tech-heavy Nasdaq Composite (^IXIC) slipped roughly 0.3%.
Stocks have become marooned ahead of the release of the Consumer Price Index on Wednesday, seen as a pivotal point for a market facing a slower next leg higher after a strong first quarter.
Investors have become increasingly less convinced the Federal Reserve will deliver on the three rate cuts it has projected for this year, given the persistent show of strength in the US economy. That has intensified the focus on the CPI print for March, and any sign that inflation has begun to cool again will be seen as an invitation for a June policy shift.
Meanwhile, fading rate-cut hopes have helped push up the 10-year Treasury (^TNX) yield near five-month highs — another potential headwind for stocks, with the 5% level seen as the key point of concern. The benchmark yield slipped about 5 basis points on Tuesday to trade around 4.4%.
At the same time, rising metals prices have sparked concerns about a feed-through effect on inflation. Copper (HG=F), a key industrial input, put on about 0.7% early Tuesday, adding to a 10%…
