Wall Street Flat as Focus Returns to the Federal Reserve

Reuters

U.S. stocks were slightly lower Wednesday as investors reassessed the timing and pace of interest-rate hikes from the Federal Reserve amid rising Treasury yields.

The S&P 500 (SPX) was 2 points, or 0.1%, lower at 1,986.34. The Dow Jones Industrial Average (DJI) lost 10, or 0.1%, to 17,004. The Nasdaq Composite (RIXF) fell 2 points, or 0.1%, to 4,547.33.

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Fed triggers jitters: The yield on the 10-year Treasurys rose 3.5 basis points to 2.534%, rising for the fifth consecutive session. Craig Erlam, market analyst at Alpari, said a lack of fresh economic data is weighing on stocks globally, but rising bond yields, particularly in the U.S., may be the bigger culprit.

"Rising yields may reflect a slight repricing of the first rate hike, with some believing that markets had priced in a later hike than the Fed is suggesting," he said in a note. But he said there isn't any recent evidence to suggest the Fed has indeed brought rate-hike expectations forward.

Investors will look to next week's Federal Open Market Committee meeting for fresh guidance on rates.

Stocks to watch: Analysts at Pacific Crest cut Apple (AAPL) to sector perform, citing a lack of new "profit drivers" to maintain an outperform rating after the iPhone maker unveiled the latest version of its popular phone and a new Apple Watch wearable device on Tuesday. Shares rose 1%.

GT Advanced Technologies Inc. (GTAT) shares slid 11% after Apple said it won't move toward broad use of sapphire cover screens, which GT provides.

Shares of Microsoft (MSFT) could grab investors' attention on a report in The Wall Street Journal that the technology group is set to pay about $2 billion in a deal to buy the maker of the popular "Minecraft" videogame.

Land's End Inc. (LE) shares rallied 12% after the clothing retailer posted better-than-expected sales and profit in its fiscal second quarter.

Krispy Kreme Doughnuts (KKD) skidded 4.6% after the doughnut chain posted stronger sales, but adjusted profit missed forecasts.

Other markets: European markets came off intraday lows. Asian markets were lower, with the exception of a small rise for the Nikkei 225 index . As investors backed away from stocks, gold prices(GCZ4) rose and the dollar continued to climb, hitting another nearly six-year high against the yen (USDJPY).