The Dow Jones industrial average closed 180 points lower Tuesday after falling 240 points. Home Depot fell nearly 2.5 percent to contribute the most to declines in the index as nearly all constituents fell. Early Tuesday, the home improvement retailer posted quarterly earnings and revenue that topped expectations and also raised its full-year guidance. The stock is up more than 16 percent over the last 12 months.
The Dow transports gave up much of their earlier gains to close 0.6 percent higher with Kirby and Avis Budget leading most constituents higher.
"A lot of money gets pushed hard into one sector and it helps the overall market," said Adam Sarhan, CEO of Sarhan Capital.
"We're seeing a lot of ... sideways, trendless activity as the market desperately waits for the next big catalyst," he said.
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In U.S. economic news, industrial production rose 0.7 percent in April. Capacity utilization was 75.4 percent.
The Consumer Price Index rose 0.4 percent in April, the Labor Department said. Ex-food and energy, the index rose 0.2 percent last month, or 2.1 percent over the last 12 months. That compares with a 2.2 percent rise for the 12 months ending March.
Housing starts rose 6.6 percent in April to a seasonally adjusted annual pace of 1.17 million units.
Treasury yields held mostly higher, with the 10-year yield around 1.76 percent and the 2-year yield briefly hitting 0.827 percent, its highest since April 28.
The U.S .dollar index was a touch lower, with the euro around $1.132 and the yen near 109.1 yen against the greenback.
"I don't think CPI's hot enough to make a difference (about a Fed rate hike). I think you've got an unchanged rate hike environment. You've got a bit of sell-off in European markets," said Art Hogan, chief market strategist at Wunderlich Securities.
European stocks were mostly lower, with the German DAX off more than half a percent. Asian stocks closed mostly higher, with the Nikkei 225 up 1.1 percent and the Shanghai composite off 0.25 percent.