US stocks traded mixed Monday ahead of a Federal Reserve policy-setting meeting and as inflation concerns weighed after Kimberly-Clark warned of earnings pressure from commodity prices.
The Dow Jones Industrial Average points dropped 26.11 points (0.21 per cent) to finish at 12,479.88.
The tech-rich Nasdaq Composite rose 5.72 points (0.20 per cent) to 2,825.88, while the broad-market S&P 500 stock index shed 2.13 points (0.16 per cent) at 1,335.25.
"Stocks spent most of a thinly traded session wading in red ink, as a round of lackluster earnings reports overshadowed an encouraging dose of housing data," said Andrea Kramer at Schaeffer's Investment Research.
Investors trod cautiously ahead of the two-day Federal Open Market Committee (FOMC) meeting that opens Tuesday, where the central bankers are widely expected to maintain their policy of rock-bottom interest rates, she said.
"The less-than-impressive earnings showings did little to inspire buying ahead of the Federal Open Market Committee's (FOMC) two-day policy meeting, and instead whet traders' appetite for 'safe-haven' assets like gold and silver," she added.
Ryan Sweet at Moody's Analytics said the pressure would be on chairman Bernanke to clarify the FOMC's position on growth, inflation and monetary policy when he takes questions from the media after the meeting.
"Because this will be Bernanke's first post-FOMC press conference (and the first for any Fed chairman), there is little room for error. Miscommunication could rattle financial markets and create additional uncertainty about the path of monetary policy," Sweet said in a research note.
The action came after US equity markets wound up a holiday-shortened week Thursday with solid gains that put the Dow near a three-year peak.
European and several Asian markets were closed Monday for holidays.
Stocks were under pressure "after Kimberly-Clark reduced its profit outlook because of rising costs," said Scott Marcouiller at Wells Fargo Advisors.
The personal-care products firm, maker of Kleenex tissues and Huggies diapers, reported a fall in first-quarter profit and lowered its full-year forecast mainly due to elevated commodity prices. Kimberly-Clark shares dropped 2.7 per cent to $64.24.
Investors digested a better-than-expected housing industry report that nevertheless highlighted how dire conditions are.
According to the Commerce Department, new-home sales rebounded in March, rising a bit above 11 per cent from February to 300,000.
"The new home market did improve in March but given it rose from the lowest sales level on record, that is not saying a whole lot," said Joel Naroff at Naroff Economic Advisors.
Among stocks in focus, computer chip maker Advanced Micro Devices edged down 0.1 per cent to $8.70 despite reporting quarter earnings nearly doubled from a year ago, beating market expectations.
Flash memory card giant SanDisk, also posting better-than-expected profit, rose 1.6 per cent to $49.78.
Ahead of the long holiday weekend, stocks racked up gains Thursday as encouraging earnings reports helped the market shake off disappointing economic data, pushing the Dow to its highest peak since June 5, 2008.
The bond market gained. The yield on the 10-year Treasury fell to 3.36 per cent from 3.40 per cent late Thursday, while that on the 30-year Treasury slipped to 4.46 per cent from 4.48 per cent.
Bond yields and prices move in opposite directions.