U.S. stocks ended mixed on Tuesday, with the Nasdaq Composite rallying after stiff losses, as investor concern about the global economy ebbed.
Tuesday's drop had "not much to do with what is going on in the states, there is no shift in fundamentals," said Peter Cardillo, chief market economist at Rockwell Global Capital.
Rather, developments overseas gave investors "an excuse to take some money off the table," he added.
Another market analyst said investors more worried about the dearth of data to support the notion that lower gasoline prices are translating into increased consumer spending during the holiday shopping season.
"Black Friday is broken, as retailers have extended it now to the whole period. Consumer spending will be stronger this year, but the problem with the market is we haven't gotten the evidence," said Andrew Wilkinson, chief market analyst at Interactive Brokers.
Whole inventories versus expectations for a 0.1 percent gain.
Another report Tuesday had small business optimism rising in November to its highest level in almost eight years.
Autozone jumped after the auto-parts retailer reported quarterly profit and revenue above estimates; H&R Block fell after the tax-preparation firm reported an adjusted quarterly loss that was larger than expected, and
Major U.S. Indexes
The Dow Jones Industrial Average shed as much as 222 points, and ended down 51.28 points, or 0.3 percent, at 17,801.20, with blue-chip losses led by Verizon Communications after the wireless carrier late Monday said promotional offers and price cuts would dent its fourth-quarter profit.
Merck & Co. also weighed on the Dow after saying it would go ahead with its $8.4 billion acquisition of Cubist Pharmaceuticals regardless of a court ruling that could hasten onto the market generic versions of Cubist's best-selling product.
The shed half a point to 2,059.82, with telecommunications the poorest performer and energy the best among its 10 major sectors.
The Nasdaq rose 25.77 points, or 0.5 percent, to 4,766.47.
For every two shares falling, roughly three gained on the New York Stock Exchange, where 834 million shares traded. Composite volume neared 4 billion.
The CBOE Volatility Index, a measure of investor uncertainty, jumped 4.8 percent to 14.89.
The Shanghai Composite Index tanked more than 5 percent and gold jumped 2.9 percent as investors sought a safe haven.
Moving to propel local governments from using hazy financing instruments to raise funds, China stepped up its efforts at creating a more transparent municipal bond market.
"What really spooked the market is they restricted riskier forms of debt for collateral. They are basically indicating the economy is probably slowing at a faster pace than anticipated," said Cardillo.
Oil bounced back from a five-year low, with West Texas Intermediate lately up 77 cents, or 1.2 percent, at $63.82 a barrel on the New York Mercantile Exchange. Gold futures jumped $37.10, or 3.1 percent, to $1,232.00 an ounce.
"Mr. Market is still trying to figure out if falling energy prices are good or bad and if they are dropping because of supply or demand," said Nick Raich, CEO at the Earnings Scout, in emailed commentary.
Read MoreOil's impact on stocks: Barrel half empty, half full
The U.S. dollar edged lower against the currencies of major U.S. trading partners; the yield on the 10-year Treasury note fell 4 basis points to 2.2191 percent.
On Monday, U.S. stocks fell sharply, with benchmarks retreating from records and the energy sector slammed as the price of crude fell below $63 a barrel for the first time since July 2009.
Read More Dow's biggest dip since October as stocks hit by oil
Coming Up This Week:
Wednesday
Earnings: Costco, Hovnanian, Toll Brothers, Lands' End, Vera Bradley, Men's Wearhouse
1:00 p.m.: $21 billion 10-year note auction
2:00 p.m.: Federal budget
Thursday
Earnings: Lululemon Athletica, Ciena, Adobe Systems, Quiksilver, Esterline Tech
8:30 a.m.: Initial claims
8:30 a.m.: Retail sales
8:30 a.m.: Import prices
10:00 a.m.: Business inventories
1:00 p.m.: $13 billion 30-year bond auction
Friday
8:30 a.m.: PPI
9:55 a.m.: Consumer sentiment
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