Stocks fall in morning trading, easing off record highs

Stocks fell in morning trading Tuesday and pulled back from their latest record highs as investors continued monitoring corporate earnings reports.

Markets have been choppy as investors try to get a clearer picture of how well the economy is recovering from the pandemic and how the Federal Reserve will eventually ease up on its support for low interest rates. The central bank is meeting Tuesday and will release its latest statement on Wednesday.

The S&P 500 fell 0.4% as of 9:59 a.m. The benchmark index reached a new record high on Monday. The Dow Jones Industrial Average fell 144 points, or 0.4%, to 34,991 and the Nasdaq fell 0.6%.

Banks were among the biggest losers as bond yields fell. They rely on higher yields to charge more lucrative interest rates on loans. The yield on the 10-year Treasury fell to 1.24% from 1.27% late Monday. Bank of America fell 1.4%.

Long-term bond yields have eased off from their sharp rise earlier in the year, but Wall Street is still worried about inflation. Wednesday's report from the Fed could give investors more clues about the central bank's level of concern and when it might start reducing its monthly bond purchases that have helped keep interest rates low.

Investors considered a mixed bag of earnings from several large companies. UPS slumped 7.6% after its revenue for the latest quarter fell short of analysts’ forecasts. Wall Street brushed off seemingly solid results from several other companies. Tesla fell 1.5% and industrial conglomerate 3M fell 2.2%, despite reporting solid financial results.

Apple and Microsoft will release their latest results after the market closes.

The broad declines in the U.S. follow more drops in China, where a regulatory clampdown on various companies is spooking investors. Hong Kong’s Hang Seng lost 4.2% and the Shanghai Composite lost 2.5%.