Wall Street's major market averages were mixed on Tuesday, with caution setting in before the U.S. presidential nominees face off in a debate, and ahead of inflation data set to arrive this week.
The key averages moved in between minor gains and losses, continuing a pattern prominent in equities in recent sessions.
"We concur with the view that the market is likely to remain choppy at least until the [November U.S.] election. Macro data have been weakening, especially in manufacturing/goods, which represent 50% of earnings for the S&P 500 (but less than 20% of US GDP)," Ohsung Kwon, U.S. equity and quant strategist at Bank of America, said in a note.
Investors will tune into the debate between Former U.S. President Donald Trump and current Vice President Kamala Harris, set for Tuesday evening. Tax and tariff proposals are among the items on the market's radar for the only scheduled debate between the Republican and the Democrat.
"The only thing that can't be predicted with a decent level of certainty is how tonight's debate will go between Harris and Trump," David Morrison, senior market analyst at Trade Nation, said. "Yet we're approaching 'decision time' for U.S. equity markets," he said. Early voting in some U.S. states will begin before the November contest.
In the fixed-income market, the 10-year Treasury yield (US10Y) was down 3 basis points to 3.67%. The 2-year yield (US2Y) was down 2 basis points to 3.64%.
Also on tap this week are the August consumer and producer price index reports. The CPI is expected early Wednesday, and the PPI on Thursday. The two inflation reports could point to the size of the anticipated rate cut at this month's Federal Reserve meeting.
Wall Street's major market averages finished higher on Monday.
"There wasn't a single catalyst for the recovery, but in a constantly flip-flipping macro narrative the sense yesterday was that last week's fears about a sharper U.S. downturn were overdone, and the headline data still wasn't consistent with a recession," Deutsche Bank's Jim Reid said.
In the last 24 hours, the more positive momentum shift was down to sentiment rather than any new data, Reid added.
In the markets, Goldman Sachs (GS) -3.8% as the investment bank warned of a $400M pre-tax write-off related to its exit from the consumer arena.
J.P. Morgan & Chase (JPM) -6% after President and COO Daniel Pinto said next year's net interest income "will be lower" than what analysts are expecting.