Stocks ended lower Tuesday as a drop in consumer confidence dragged on the market.
The Dow Jones Industrial Average shed 47.16, or 0.5 percent, to close at 9,742.20. The S&P 500 lost 0.2 percent and the Nasdaq fell 0.3 percent.
This came after all three indexes logged their best one-day gains since the summer on Monday as investors cheered a flurry of M&A activity.
The Conference Board's consumer-confidence index dropped to 53.1in September from 54.5 in August. Economists surveyed by Reuters had expected the gauge to rise to 57.
"While not as pessimistic as earlier this year, consumers remain quite apprehensive about the short-term outlook and their incomes. With the holiday season quickly approaching, this is not very encouraging news," Joshua Shapiro of MFR Inc. wrote in a note to clients.
Meanwhile, investors shrugged off a better-than-expected housing report: Home prices continued to rebound, up for a third straight month in July, after a three-year slide.
3M and Cisco , some of the biggest gainers in the previous session's rally, were among today's biggest drags: Both stocks fell more than 1 percent.
Banks ended mixed, with Citigroup up nearly 3 percent, and Bank of America down 0.4 percent.
CIT Group jumped 32 percent following a report that hedge fund manager John Paulson is considering merging the troubled finance company with failed mortgage lender IndyMac Federal Bank.
Boeing was the top gainer on the Dow, up 2.9 percent.
Shares of Walgreen jumped more than 9 percent after the drug-store chain beat earnings expectations, helped by store makeovers and job cuts.
Dell lost more than 3 percent after the computer maker said it's expanding its efforts in Chinaas it plays catch-up with Lenovo and HP in one of the world's fastest-growing PC markets.
Starbucks shed 1.2 percent after the barista announced plans to roll out a line of instant coffee.
Sequenom tumbled nearly 40 percent after the genetic-analysis test maker said it fired its CEO and a swath of its top management team following a scandal over mishandling of research data.
With the third quarter ending on Wednesday, earnings season is just around the corner. There are a few reports trickling out after the bell today, including Nike and Micron .
Volume was light, with 1.18 billion shares changing hands on the New York Stock Exchange. Decliners outpaced advancers, roughly 8 to 7.
With one day left to go in th quarter, the Dow and S&P are on track for their best quarterly percentage gains since the fourth quarter of 1998.
Still to come: We'll get reports on GDP, auto sales, ISM manufacturing and the September employment situation later in the week.
Still to Come:
WEDNESDAY: Weekly mortgage applications; ADP jobs report; GDP; weekly crude inventories; Fed's Lockhart speaks
THURSDAY: Personal income/spending; jobless claims; ISM manufacturing index; pending-home sales; construction spending; auto sales; Fed's Bernanke, Pianalto, Lockhart speak
FRIDAY: Sept jobs report; factory orders; Calif. IOUs mature
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