Stocks edge mostly lower, pull indexes off all-time highs

In this Nov. 5, 2020 file photo, a sign for Wall Street is carved in the side of a building, in New York. Stocks are opening slightly lower on Wall Street Wednesday, Aug, 18, 2021, a day after the S&P 500 had its biggest drop in four weeks and broke a five-day winning streak. (AP Photo/Mark Lennihan, File)

Stocks edged mostly lower in afternoon trading Wednesday, a day after the S&P 500 had its biggest drop in four weeks and broke a five-day winning streak.

The S&P 500 index fell 0.1% as of 2:36 p.m. Eastern. The Dow Jones Industrial Average was down 74 points, or 0.2%, to 35,269 and the Nasdaq composite rose 0.2%. The Russell 2000 index of small company stocks was up 0.2%.

The indexes were little changed following the release of the minutes from the Federal Reserve’s policy meeting last month. The minutes, released at 2 p.m. Eastern, showed that Fed officials discussed the timing for beginning to dial back their extraordinary support for the U.S. economy, which has been steadily recovering from the pandemic recession, but made no decisions on the timing for the start of the reductions in bond purchases.

Investors have been trying to glean insight on how the Fed’s policymakers see the U.S. economy doing as it comes out of the pandemic as well as any concerns they might have about inflation. Wall Street's biggest worry is that the Fed will end its easy money policies earlier than expected to combat inflation, which would put some drag on the U.S. economy in its recovery.

Some Fed officials, citing strong hiring growth and rising inflation, have said that the central bank should start normalizing monetary policy soon. Others argue the Fed needs to see stronger economic data to be sure a recovery is established.

The minutes showed that policymakers concluded it would be appropriate to acknowledge that the economy was making progress in achieving the Fed’s goals on inflation and maximum employment. But the officials did not shed any light on when that progress would be seen as sufficient to begin trimming the bond purchases.

The yield on the 10-year Treasury note rose to 1.27% from 1.25% late Tuesday.

A slide in health care and technology stocks helped pull the S&P 500 lower. A mix of companies that sell food and personal goods also fell. Those losses outweighed gains by communication stocks and companies that rely on consumer spending. Even so, the S&P remains near its all-time high set on Monday.

The surge this summer of virus cases because of the highly contagious delta variant now hangs over the broader market and is blurring the view on the economy's continued recovery. The path of the virus and its impact on consumer spending and job growth could be a factor in the Fed's decision making.

“We're having a pretty cautious week for the most part,” said Chris Zaccarelli, chief investment officer for Independent Advisor Alliance. “A lot of the people who were optimistic that reopening would happen quickly are obviously disappointed, but we're looking at what’s happening with the delta variant as more of a setback, not a change in direction,” he said.

The surprisingly aggressive spread of the delta variant has prompted U.S. health officials to recommend COVID-19 booster shots to all vaccinated Americans, though the overall plan awaits a Food and Drug Administration evaluation of the safety and effectiveness of a third dose. Makers of COVID-19 vaccines were down following the news. Pfizer slipped 0.3% and Moderna fell 2.1%.

Earnings season is winding down, with retailers being among the last industries to report. Lowe's rose 11.1% after the home improvement company reported results that were better than expected. It also gave an upbeat forecast. That's in contrast to Home Depot, which the day before seemed to indicate a slowing down in sales after the do-it-yourself boom in the pandemic.

Companies reporting after the closing bell include the brokerage app Robinhood, chipmaker Nvidia and telecommunications giant Cisco Systems.