NEW YORK, New York - U.S.stocks were weaker on Tuesday as the direction of interest rates took center-stage. The White House and the Federal Resreve remain at odds, but the central bank also seems to be divided within.
St. Louis Federal Reserve Bank President James Bullard told Bloomberg early in the day he doesn't think the Fed needs to cut rates by as much as 50 basis points at its next policy meeting, in late July.
"You had a one-two punch," Art Hogan, chief market strategist at National Securities in New York told the Reuters Thomson news agency. "Powell came out and warned against policy bending to short-term political interests, but it is also Bullard, who is a dissenter, saying 50 basis points would be too much."
At the close of trading Tuesday the Dow Jones Industrial Average was 178.9 points, or 0.67%, lower at 26,548.64.
The Standard and Poor's 500 slipped 27.9 points, or 0.95%, to 2,917.45.
The main damage was in the tech sector where the Nasdaq Composite fell 120.98 points, or 1.51%, to 7,884.72.
On foreign exchange markets the U.S. dollar clawed back some of its recent losses sending the euro and pound beloiw the crucial 1.1400 and 1.2700 handles.
Late in the trading session in New York on Tuesday, the euro was changing hands at 1.1365.
The British pound slipped to 1.2689.
The Japanese yen fell to 107.19, while the Swiss franc eased to 0.9757.
The Canadian dollar was quoted at 1.3174, while the Australian and New Zealand dollars were only a fraction lower at 0.6958 and 0.6643 respectively.
In the UK, the FTSE 100 gained 0.08%. The German Dax fell by 0.38%, while in Paris, the CAC 40 dipped by 0.13%.
In Asian markets, the Nikkei 225 in Japan lost 92.18 points or 0.43% to 21,193.81.
The Australian All Ords fell 11.00 points or 0.16% to 6,734.50.
In China, the Shanghai Composite shed 26.07 points or 0.87% to 2,982.07.
The Hong Kong Hang Seng did worst of all in Asia, falling 327.02 points or 1.15% to 28,185.98.