U.S. stocks closed mixed on Tuesday as investors eyed renewed gains in yields and the dollar ahead of the Federal Reserve meeting minutes. (Tweet This)
The Dow Jones industrial average closed at a record for the second day in a row, ending below its intraday high of 18,351.36 set in the afternoon.
The S&P 500 briefly extended gains to hit a new intraday record but failed to close higher. The Nasdaq fell into negative territory after coming within 10 points of its closing high of 5,092.08.
"I still think there's uncertainty around what the Federal Reserve is going to do," said Ben Pace, CIO at HPM Partners. "It's not been a great year but we're still up 3 percent in (the S&P 500). It's been an OK market."
The major averages fluctuated around the flatline throughout the day, struggling to hold gains after better-than-expected housing data renewed anxiety over the timing of a rate hike.
"I thought we had moved past good news is bad news for equities. We seem to be fixated still on the Fed question in the debt markets and whether interest rates are going to go up," said Chris Gaffney, president of EverBank World Markets.
The Federal Reserve Open Market Committee is expected to release the minutes of its April meeting on Wednesday, while several policymakers, including Janet Yellen, are scheduled to speak later in the week.
"I think the Fed does focus on the housing market," said Alan Rechtschaffen, financial advisor and senior vice president at UBS Wealth Management Americas."When you have a better-than-expected housing starts number you have to say to yourself, 'Is that a 1-month thing?'"
April's housing starts totaled 1.135 million in April, nearly a seven-and-a-half year high and above the 1.020 million estimate. The beat follows weak readings of little above 900,000 in February and March.
"The longevity of this cycle depends on housing," said Maris Ogg, president of Tower Bridge Advisors. "So I was glad to see the numbers pick up this morning."
The Dow Jones industrial average and the S&P 500 closed at records on Monday after setting new intraday highs.
U.S. stock futures indicated a higher open as European equities advanced, with investors reacting to corporate earnings and comments on the timing of bond-buying by a member of the European Central Bank.
"It was originally Europe, then it shifted to us when the rally in the 10-year had given back all its rally (and began selling off)," said Peter Boockvar, chief market analyst at The Lindsey Group. "The strong dollar is also an issue here."