The S&P 500 started this week on a weaker note by falling on Monday amid the sell-off in the technology sector. Investors largely expect the central bank to raise interest rates by a quarter point. The IT sector was, prior to last week's setback, dominating share price growth in USA equity markets during the course of the year.
Investors will also be looking for any details on the Fed's plans to trim its $4.5 trillion balance sheet in the face of improving economic conditions.
S&P 500 measures the performance of 500 widely held common stocks of large-cap US companies. The S&P 500 Index came within 5 points of all-time highs, and the Dow Jones Industrial Average hit an all-time high on Tuesday.
The S&P 500 finished down 2.38 points, or 0.1%, at 2,429.39, the Dow ended three days of gains to close down 36.30 points, or 0.2%, at 21,235.67. The Nasdaq Composite Index rose 0.56% to 6,211.12, a gain of 0.58%.
"The bottom line continues to be that small businesses remain hopeful for positive policy changes out of the [Trump] Administration", said Peter Boockvar, chief market analyst at The Lindsey Group.
The central bank is widely expected to nudge up USA interest rates by another quarter point, but economists will be watching to see whether the recent dip in economic data and wave of uncertainty surround Donald Truump has weighed on confidence. We argue that this could be good news for financials, who could benefit at the tech sector's expense.
Shares of Bank of America BAC.N , Wells Fargo WFC.N and JPMorgan JPM.N were up about 1 percent.
Crude oil was positive on the day and was last trading up 1% at $46.53.
Major U.S. stock-market benchmarks pulled back on Monday, driven by a second straight session of firm losses in technology shares, but the shift away from tech appears to be feeding recently unloved sectors and smaller cap stocks.
Tech stocks stemmed their recent slide.
European markets closed lower: London's FTSE fell 0.2 per cent, Paris lost 1.1 per cent and Frankfurt fell about 1 per cent.
Meanwhile, a record 44 percent of fund managers polled in a monthly survey, conducted between June 2 and June 8, from Bank of America Merrill Lynch see equities as overvalued, up from 37 percent last month, Bloomberg reported.
Advancing issues outnumbered decliners on the NYSE by 1,847 to 993.
About 7.89 billion shares changed hands in USA exchanges, far above the 6.81 billion daily average over the last 20 sessions.