Major U.S. indexes finished mostly lower Tuesday as rising interest rates hurt stocks that pay big dividends, and higher oil prices pushed transportation and shipping companies lower. The S&P 500 index fell for the third day in a row.
Oil prices continued to rise after a weekend meeting of the Organization of Petroleum Exporting Countries and its allies ended without an increase in oil production. That has helped energy companies, but it is pressuring airlines and other companies that will have to pay more for fuel. Higher oil prices can also ripple through the economy and increase inflation, and that has helped push interest rates higher this week.
On Wednesday, the Federal Reserve is expected to increase its benchmark interest rate for the third time this year. Investors have been sure for months that the Fed would raise rates at the meeting, so they'll be focusing on the Fed's economic projections and Chairman Jerome Powell's news conference afterward.
“He'll want to say as little as possible about tariffs, about fiscal policy, and say as little as possible about any advice the president may be giving him and the Federal Reserve about how to run monetary policy,” said David Kelly, chief global strategist for JPMorgan Funds. But Kelly said the reporters will likely probe Powell's views on all of those topics.
The S&P 500 fell 3.81 points, or 0.1%, to 2,915.56. The Dow Jones Industrial Average lost 69.84 points, or 0.3%, to 26,492.21. The Nasdaq composite added 14.22 points, or 0.2%, to 8,007.47. The Russell 2000 index of smaller-company stocks gained 3.49 points, or 0.2%, to 1,708.80.
Bond prices kept falling as the Fed meeting began, sending yields higher. The yield on the 10-year Treasury note rose to 3.10% from 3.07% a day earlier.
Rising bond yields tend to hurt high-dividend companies, which many income-seeking investors see as substitutes for bonds. Among utilities, Southern Co. fell 2.5% to $42.73 and consumer goods maker Procter & Gamble lost 1.4% to $83.12.
Oil prices have climbed recently because OPEC isn't producing more oil, while Iran is exporting less after the United States withdrew from the international nuclear deal with Iran and announced more sanctions on the country.
Benchmark U.S. crude rose 0.3% to $72.28 a barrel in New York. Brent crude, the standard for international oil prices, rose 0.8% to $81.87 a barrel in London. Brent crude is at its highest price since November 2014.
ConocoPhillips rose 1.4% to $78.11 and Philips 66 added 1.3% to $114.88.
Drive-in restaurant chain Sonic jumped 18.7% to $43.46 after it agreed to be bought by Inspire Brands, which also owns Arby's and Buffalo Wild Wings. The purchase values Sonic at $43.50 a share, or $1.57 billion. Inspire Brands is controlled by the private equity firm Roark Capital.
XO Group, which runs the wedding marketplace the Knot, jumped 26.3% to $34.91 after it accepted a $907-million offer from two funds that own its competitor WeddingWire.
Companies around the world have announced $3.26 trillion in deals this year, according to Dealogic, far above the $2.49 billion in deals that were struck over the first three quarters of 2017. The recent U.S. corporate tax cut and low interest rates have contributed to that trend.
If the Fed does raise interest rates Wednesday, it would be the ninth increase since late 2015 and would take the benchmark rate to a range of 2% to 2.25%, with another increase expected this year and more to come in 2019.
Wholesale gasoline added 0.6% to $2.07 gallon. Heating oil rose 0.8% to $2.31 a gallon. Natural gas rose 1.4% to $3.08 per 1,000 cubic feet.
Gold rose 0.1% to $1,205.10 an ounce. Silver gained 1.1% to $14.49 an ounce. Copper fell 0.4% to $2.82 a pound.
The dollar rose to 112.93 yen from 112.73 yen. The euro rose to $1.1767 from $1.1758.
The British FTSE 100 index rose 0.7%. The DAX in Germany added 0.2% and France's CAC 40 gained 0.1%.
Tokyo's Nikkei 225 gained 0.3% and the Sensex in India slipped 0.1%. Markets in Hong Kong and Seoul were closed for holidays.