Major U.S. indices finished in a mixed fashion on Tuesday, as investors remained cautious amid persistent concerns about interest rates and a mixed batch of earnings reports from key companies.
The S&P 500 edged down by 0.1% to close at 5,851.2, marking its first consecutive daily loss since early September. Meanwhile, the Dow Jones Industrial Average was little changed at 42,924.9, while the Nasdaq Composite slightly outperformed, rising 0.2% to 18,573.1.
The market's apprehension was mirrored in the bond market, where the rise in yields was influenced by cautious commentary from Federal Reserve officials, who suggested a more measured approach to future interest rate cuts.
Yields have been trending upwards since the Federal Reserve's recent half-point rate cut, driven by a combination of positive economic data and doubts over the Fed's future stance on rate reductions.
Traders are now pricing in a 91% chance of a quarter-point rate cut at the Fed's next meeting, scheduled to conclude on 7 November, according to the CME's FedWatch tool.
The higher yield environment took a toll on homebuilding stocks, with both Lennar and D.R. Horton falling over 3% as concerns about a prolonged period of elevated rates weighed on the sector.
In individual stock movements, General Motors surged nearly 10% after surpassing Wall Street's third-quarter forecasts and raising its full-year guidance.
Tobacco giant Philip Morris also saw a roughly 10% jump following an upgraded annual profit outlook.
In contrast, Verizon dropped 5% as its revenue narrowly missed analysts' expectations, while Lockheed Martin fell 6% after reporting weaker-than-anticipated quarterly sales.
Ahead in the week, market participants will be closely monitoring upcoming earnings, including reports from Tesla and Coca-Cola on Wednesday, followed by Honeywell on Thursday.
On the bond markets, 10-year rates lifted to 4.208% while 2-year rates were at 4.032%.